Income and Expenditure

1. Income

Income is the money you receive regularly (weekly, fortnightly, or monthly).

• Wages:
  • Paid weekly. Amount depends on hours worked (e.g. overtime increases pay).
• Salaries:
  • Paid monthly or fortnightly. Fixed amount.
• Social welfare payments:
  • Payments for those who cannot work or earn an income.
  • Jobseeker's Allowance: For unemployed people (e.g. €112.70 per week for ages 18–24).
  • Disability Allowance: For those unable to work due to illness or disability (€203 per week).

Key Terms:

• Gross income: Total pay before deductions.
• Net income: Pay after deductions (also called "take-home pay").

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2. Deductions

Deductions are amounts taken out of wages or salaries.

Statutory deductions (compulsory):

These must be paid:

• Income Tax (PAYE): Tax on earnings to fund public services (schools, hospitals).
• PRSI: Pay Related Social Insurance. Funds social benefits (e.g. maternity leave, pensions).
• USC: Universal Social Charge – introduced to help the economy recover.
• Pension payments: Contributions towards retirement savings (compulsory in some jobs).

Voluntary deductions (optional):

These are paid by choice:

• Health insurance (e.g. VHI, Irish Life).
• Private pensions (e.g. Zurich).
• Savings plans (e.g. Standard Life).
• Union membership fees (e.g. TUI).

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3. Expenses

Expenses are the costs you must pay.

Types of expenses:

1. Essential expenses (needs): Must be paid for. Examples:

• Mortgage/rent, food, electricity, school books.

2. Non-essential expenses (wants): Desired but not necessary. Examples:

• Family holidays, meals out, branded clothes.

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4. Common Family Expenses

Here's a list of typical family expenses:

• Housing: Rent/mortgage.
• Groceries: Food, cleaning products.
• Household expenses: Electricity, heating, water, waste disposal.
• Education/Childcare: School books, crèche fees.
• Travel: Car repayments, insurance, bus fares, bicycle costs.
• Clothing: Winter coat, shoes.
• Medical: Doctor, dentist, medicines, health insurance.
• Savings: Credit union, bank savings.
• Entertainment: Internet, TV, going out, holidays.