50+ Sample Income Worksheets
What Is an Income Worksheet?
An income worksheet is a working file that lists and arranges the different items pertaining to one’s income. It typically comes in the form of a spreadsheet or table.
In a recent online article, Time Magazine has come up with 8 proven passive income ideas that people can take advantage of, especially in a post-pandemic time. Jannese Torres-Rodriguez suggests the following ideas: dropshipping or online retailing, blogging, digital courses, e-books, digital downloads, affiliate marketing, real estate investing, and investing in the stock market. Of course, each idea comes with its own set of benefits and challenges. But for anyone who is looking for alternative income streams that does not involve traditional employment, perhaps the ideas are worth looking into to.
Types of Income Worksheets
Because income can cover several areas, there are also different kinds of worksheets that you can use based on the type of income. The following are some examples of various income worksheets:
Rental Income: If you are a landlord or you own a property, leasing out space to tenants or clients is a way of earning income. It’s easier to manage your rental income when you have a worksheet containing all the information regarding your cash flow and tenants. It will serve as a monitoring tool to track monthly dues, who’s behind in rent, late fees charges, security deposits, lease renewal dates, etc. Business Income: How does your business earn profit? What are the key money generating enterprises or practices in your business? It’s key to identify all these because it will help you run and improve your business in the long run. Whatever the nature of your business, having an effective tracking tool for income and monetary flow is absolutely essential. But income tracking is usually not enough, it is often always paired with expenses. Having an idea of how these two factors come into play in your business is crucial for success and growth. For instance, an online seller’s main source of profit is the income generating store she set up on an ecommerce platform. A worksheet will help her track all her orders, sales, profit margins, as well as the costs needed to improve and maintain her online store. Monthly Income: For most people, a steady paycheck or a monthly salary is their main source of income. The predictability of monthly salaries and regular wages are great for those who seek a consistent and reliable means of livelihood. But earning our own money is one thing, being responsible for the money we earn can be a different story. Workers and employees do not only need to be aware, but also proactive when it comes to their finances. If left unchecked, you can find yourself drowning in your own debt, especially credit debt. Thus, it’s important to set limits in your spending habits and set boundaries when it comes to splurging. Having a worksheet is helpful in keeping track of your finances- meaning both your income and expenses. Regularly monitoring these two important factors can promote financial responsibility and prevent overspending. Retirement Income: For some retirees, the dream of relaxation and endless leisure is a far cry from the actual reality of retirement. People in old age still need security and have to find it in other places- not necessarily from employment, which is an active source of income. For most countries, social security and pensions are mandated by law. Corporations also offer lofty retirement packages to their loyal and aging workforce. It’s crucial to keep track of one’s finances in retirement because there is no certainty that comes from a steady paycheck. There may be regular monthly pensions, but even that is limited and can only cover so much in today’s economy. Household Income: For most banks and financial institutions, a major requirement for new accounts is disclosing household income. Other cases like in loan or visa applications, family income is a common question. For family members living under one roof, a combined household income is a determining factor of whether you and your family have the means to pay back a loan, or are at risk of not being able to. To better improve the management of household income, it’s wise to use a worksheet to better organize and oversee each member’s contribution. Household expenses can also be properly managed using the same worksheet.
Sources of Income
People gain profit in a number of different ways. The common notion of most people is that income only means a monthly payout for people with steady jobs. However, there are other ways of making a living that have nothing to do with a 9-5 job. The following are some examples of typical sources of income:
Lease or Rent: A type of passive income, renting out property or subleasing is a common practice. People who want to earn additional income on top of their regular paying jobs, can opt to buy a space and rent it out to potential tenants. If you already own a place or land, you can have it leased, charge the tenant a fixed rate, and gain profit without ever needing to clock in. Advertisements: Much like rental schemes, having a platform for advertisers to use is a money-generating method too. If people can rent living space, they can also rent billboard space. Advertisements are synonymous with marketing and sales. Businesses who seek to create an impact will often go big or go home. One way for companies to promote their brand or product is through billboards and advertisements. They can opt to rent ad spaces for a certain amount of time. And just like residential rent, it is subject to renewal as well. Online Selling: Since ecommerce took off years ago, people are able to directly sell their goods to customers and clients without added intermediary cost. With traditional retail, middlemen, distributors, or brokers facilitated the relationship between producer and consumer. Nowadays, transactions are not only faster, but more direct as well. People can earn income just by selling or reselling their assets online. And although earnings will depend on the volume of sales, online retailing is a feasible side hustle. Employment: If you are like the billions of people making a living by working a full-time job, then your main source of profit is your regular salary. Employment wage is an active source of income. The advantage of having a regular paying job is the security and consistency it promises. Unlike contractual laborers and freelancers who get paid on a project-based arrangement, full-time workers get the benefit of regular payouts. Commissions: When we hear the word commission, we immediately associate it with real estate brokers, salespeople, or artists. Receiving a commission can entail anything that involves contract work. In the gig economy today, more and more people are choosing the freelance life over a typical day job. But unlike regular full-time employment, income depends on actual productivity and output in contractual work. Freelancers are not usually paid regularly and are only compensated for the work they produce at a time. Gifts: “There’s no such thing as a free lunch” may be applicable in most scenarios. However, gifts given freely and with no strings attached are also technically a form of income. Cash prizes, monetary or in-kind donations, and even regular gifts from family and friends add material value to your life. But how you use it totally depends on you. For instance, you can choose what to do with the cash you receive from a relative. You can spend it all in one place, invest it, or set it aside as savings. Tips: Gratuity is common in service industries like the hospitality sector. In addition to regular salary, hotel and restaurant workers can receive tips for their service. Tipping is generally acceptable in many countries, although it’s not always a requirement in some. If an employee is lucky enough or displays excellent customer service, some clients will tip the worker handsomely in exchange for their service.
How to Create an Income Worksheet
All you need to create an income worksheet is the basic information. Regardless of the type of income worksheet you plan to make, keep in mind the simple steps below. These steps can help make your worksheet effective and organized.
Step 1: Identify Your Sources of Income
To begin crafting your worksheet, first identify your profit streams. Using the information given above, make a comprehensive list of where you currently get your income. If one of your goals is to explore another income channel, you can also include it in your worksheet to help you get started on the plan. Feel free to arrange it in whatever order you see fit. You may also categorize your sources of income according to active or passive income.
Step 2: Create a Table or Spreadsheet
The easiest and most common way to create a worksheet is by using an Excel spreadsheet or creating your own table. Format it according to your liking; but make sure it’s clear and comprehensible enough for you to use on a regular basis. You have the option to print your own copies of the worksheet or you can also keep tabs of everything online for easier monitoring.
Step 3: Fill in the Necessary Information
The content of your income worksheet would depend on the type of worksheet you’re aiming for. For a typical employee, a monthly income spreadsheet would contain items including the account (e.g., checking, savings, credit card), date, description, category of transaction (e.g., essentials, groceries, bank transfer, bills payment), income or the incoming cash flow, expense or the outgoing cash flow, and the overall balance after transaction. For a rental income worksheet, you can add in the property address, the tenant’s contact information, move-in and lease renewal dates, and security deposit amounts in addition to the basic income information.
Step 4: Update the Worksheet Regularly
An important step is to constantly update your income worksheet whenever there is movement of either incoming or outgoing money flow. You shouldn’t neglect the consistency that is required in maintaining an income worksheet. It not only keeps your document up-to-date, but it can help you track personal progress and establish spending patterns.
How should I divide my income?
People often say that to reveal a person’s true nature, you only need to see how they act when they’re given a lot of money, and how they act with little to no money at all. There are people who can handle money well; and those who are irresponsible when it comes to their finances. But the good news is financial literacy, or learning how to handle personal finances, is a teachable skill for any adult. A good way to start is by managing your income properly. You can divide your income into needs, wants, and emergency funds. Pay your bills on time and set aside a portion of your income as savings.
What does income mean?
If you split the word ‘income’ into two, it contains the words ‘in’ and ‘come’. It is basically self-explanatory, and it emphasizes the incoming monetary value that is credited to you, the earner. Income could mean anything received or gained in exchange for labor, service, or sales.
What are the three different types of income?
According to WCG Inc., there are three basic types of income. These are active, passive, and portfolio income. Active income is your wages, tips, or commission where you actively participate in the gaining of profit. Passive income, like rent or royalties, does not necessitate the same kind of effort that active income requires. Lastly, portfolio income is the profit you gain from investing. These typically include dividends and capital gains.
What is monthly net income?
Monthly net income is your income post-deductions. Gross income is subject to different deductions including income tax, healthcare contributions, loan premiums, instances of absences and tardiness, etc. Oftentimes, net income can also be referred to as one’s take-home pay.
Income worksheets can play a vital role in managing your finances well. Whatever your source of income and whether that be active, passive, or portfolio income, it is always good to stay on top of it by consistently tracking and monitoring your progress. Take the first step towards better financial decisions today by downloading an income worksheet template above!