Do you want to increase income?  Focusing on 5 elements can help

Do you want to increase income? Focusing on 5 elements can help

2. Maximizing revenue

When setting your goals for your career this year, one of them might be to maximize your income. Perhaps you’ve taken the time to invest in yourself by earning a new degree or certification. Perhaps you have taken on more responsibility at work. Taking all these things into account, you may be able to increase your salary. We’ll delve a little deeper into salary negotiation in the next section.

But maximizing your salary isn’t the only thing it takes to maximize your income; it’s also about when and how you get paid. There are several components to maximizing revenue:

Income Deferral. It may seem counterintuitive, but one way to maximize your income is to defer some of it to the future, also called a nonqualified deferred compensation plan. This is a good option for you if you have a high salary and are in a higher tax bracket. If this is an option for you, weigh the risks against the benefits.

One risk is that if your business goes out of business, you won’t get your deferred income. But if your business is well-established, one benefit is that you don’t have to pay taxes on your entire salary, just the portion you’re paid that year.

Profits. It is critical to explore what company benefits you can use to maximize your income and earning potential. As this year begins, check with your HR department to see what your company offers that you may not be taking advantage of.

For example, my company offers our stakeholders a wellness benefit in which we are reimbursed up to $300 of gym membership fees. We offer tuition reimbursement, professional development stipends, as well as a matching gift program of up to $500 for donations to a favorite nonprofit organization. We also provide an additional $400 deposit into interested parties’ Health Savings Accounts (HSAs) if they have their annual checkup.

Make sure if you have benefits like this that you are taking advantage of them. Plus, max out your 401(k) contributions to receive the full match from your employer. Ask your human resources department if your company offers other benefits, such as legal services, child care benefits, or other types of benefits that you can use.

Equity. In some organizations, once an employee reaches a certain level, capital compensation is a possibility. It makes sense that as you advance in your career and rise through the ranks, you might wonder if stock compensation is an option for you. Your stock-based compensation is likely to cost you less in taxes than ordinary income.

Work with your financial professional to ensure you maximize your income. They can provide guidance based on your specific situation.

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