Earning Income: Turning Your Skills Into Money
Let’s talk about something that’s always on our minds as young adults: money.
It’s not just about having enough for that new pair of sneakers or the latest iPhone—it’s about setting yourself up for a future where money isn’t a constant stress. The first step? Understanding how people earn income and how to make the most of your own.
What Does “Earning Income” Really Mean?
When most people think of income, they think of a paycheck. That’s definitely a big part of it, but it’s not the whole story. Income is any money you bring in, whether it’s from your job, your side hustle, or even something like renting out a bike on the weekends.
Here are a few ways people earn money:
Wages and Salaries: This is your hourly pay or the salary you get for showing up and doing your job.
Business Profits: Got a knack for selling? Starting a small business or a side hustle (like selling art or flipping thrift finds) can bring in extra cash.
Investments: Ever heard of “making your money work for you”? That’s what happens when you earn interest, dividends, or rental income.
So even though your part-time job at the smoothie bar might be your main source of cash right now, it’s just one piece of the bigger picture.
Why Education and Skills Matter
Here’s the deal: the more you know, the more you grow—your bank account, that is. Employers are willing to pay more for people who bring value to their business. That’s why getting an education, learning a trade, or picking up new skills can lead to better-paying jobs.
But let’s be real: going to college or trade school isn’t cheap. That’s where you have to think strategically. For example:
What’s the return on investment (ROI) for a degree in your chosen field? If it costs $50,000 but helps you earn $20,000 more per year, it might be worth it.
Are there certifications or short-term programs that can boost your skills without a huge price tag?
The key is to weigh the costs and benefits so you can make choices that work for your future.
It’s Not Just About the Paycheck
Imagine you land two job offers. One pays more, but the other comes with health insurance, retirement savings, and paid time off. Which one is the better deal? Spoiler: it’s probably not the one with the higher salary.
Employee benefits—like health insurance or 401(k) contributions—can add major value. And don’t forget taxes. You might earn $15 an hour, but after taxes, it’s more like $12. Understanding these details helps you make smarter decisions about your money.
Tips for Starting Strong
If you’re just beginning your journey into earning income, here are a few things to keep in mind:
Find What You Love (and Get Paid for It): Look for jobs that match your skills and interests. Love photography? Try freelancing at events. Good with kids? Babysitting pays well.
Invest in Yourself: This doesn’t always mean college. It could be an online course, learning how to code, or even watching YouTube tutorials to get better at something you love.
Think Big Picture: Don’t just chase the highest paycheck. Consider benefits, growth opportunities, and what makes you happy.
Set Goals: Whether it’s saving for a car or building up a rainy-day fund, having goals gives your income a purpose.
This article coincides with the 2021 National Standards for Personal Financial Education 4-1: Earning Income
