What is monthly base income

It also provides useful data on common perks and benefits. While base pay only accounts for the minimum monetary compensation you receive in exchange for work, annual pay involves a whole lot more. Remember all those goodies we excluded from base pay in the section above? Things like tip income, bonuses, commissions, overtime, stock options, recognition pay, and a K matching plan are easier to assign a dollar value to.

But you may have to dig a little deeper to figure out the value of insurance premiums, paid time off , and other non-cash benefits, like the use of a company car. Our resume builder tool will walk you through the process of creating a stand-out Architect resume. Base pay can be expressed hourly, monthly, or annually. If you are an hourly employee, then your base pay will be your hourly wage.

There are pros and cons to being a salaried employee and an hourly employee. As you can see, an hourly employee must keep track of his or her hours and may receive overtime when working more than 40 hours a week.

This means that, while hourly base pay is consistent, an hourly employee cannot fully chart out their monthly or annual pay. Salaried employees do not need to keep track of their hours worked and receive flat base pay, regardless of work completed. While that might sound like a plus, it can also mean that a salaried employee might work more than 40 hours in a given week without receiving extra compensation for it.

Base pay is just one element of your compensation package. Every situation and every employee is different. Depending on your situation, you may value certain benefits, such as having your family members covered by your health insurance, more highly than others. While base salary is a very important component of your compensation package, and thus your decision to take a job or not, remember that it is not the sole component. Take the time to research what other elements of your compensation package are worth, both in the market and for your specific situation.

Negotiating your base salary when starting a new job is one of the most important things you can do. All of your future raises will be determined based on this starting number — the higher you start, the higher you end up later in your career.

But if you do opt to negotiate your salary , keep these tips in mind:. Do your research. Use any and all of the resources we listed above for finding salary data. Let the employer bring it up. Those who rush into money talk may be seen as ambitious for the wrong reasons and more interested in personal gain than helping the company achieve its goals which, of course, most people are, but we all have to play along.

Give a range. Ask questions. One way to think about net income is to see it as the "spendable" cash that actually flows through to your checking or savings account every month. Net income is also useful in developing a monthly budget since your regular after-tax expenses, both fixed and discretionary, will come from your net income. A significant share of the money is dedicated to taxes and fixed deductions, so knowing your net income will help you develop a more stable budget and allow you to stay on top of your finances.

If you're paid an annual salary, the calculation is fairly easy. Again, gross income refers to the total amount you earn before taxes and other deductions, which is how an annual salary is typically expressed.

Simply take the total amount of money salary you're paid for the year and divide it by Many people are paid twice a month, so it's also useful to know your biweekly gross income. To find this amount, simply divide your gross income per month by 2. For hourly employees, the calculation is a little more complicated. First, to find your yearly pay, multiply your hourly wage by the number of hours you work each week and then multiply the total by Now that you know your annual gross income, divide it by 12 to find the monthly amount.

Note: If your hours vary from week to week, use your best estimate of the average number of hours you work. If you have any special circumstances, such as a certain amount of overtime hours per month or a recurring bonus or commission, you can generally add it to your gross monthly income.

The common way to do this is to determine the amount of overtime pay or bonus or commission you've received throughout the past year and divide it by This amount would then be added to the gross monthly income you calculated from your base pay. Discounted offers are only available to new members. Stock Advisor will renew at the then current list price. Investing Your Practice. Popular Courses. What Is Base Pay? Key Takeaways Base pay is an employee's standard pay rate, which does not include benefits, bonuses, raises, or other compensation.

Base pay can be expressed as an hourly rate or as an annual salary. Annual pay calculations include the items not included in base bay calculations, namely benefits, bonuses, raises, and overtime.

Many salaried employees do not receive overtime pay for working their jobs. Hourly employees and salaried employees may have different benefits from their employers.

What Is Military Base Pay? What Is E-5 Base Pay? Article Sources. Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts.

We also reference original research from other reputable publishers where appropriate. You can learn more about the standards we follow in producing accurate, unbiased content in our editorial policy. Department of Labor. Compare Accounts. The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace.

Payroll Payroll is the compensation a business must pay to its employees for a set period or on a given date.

Read about payroll accounting here. What Is Remuneration? Remuneration is an employee's total compensation, including base salary, bonuses, expense account reimbursements, and other financial benefits. What Is a Stipend?

A stipend is a set amount of money that may be provided to individuals to help them offset expenses. Wage Expense A wage expense is the cost incurred by companies to pay hourly employees and is a line item that may also include payroll tax expenses and benefits.

Partner Links.