income / wealth
Last updatedDefinition
Income is the payment (generally money) that an individual receives for providing their labor or services. Income is generally provided periodically in the form of wages or salary, though contract work may provide single lump-sum payments or other forms of remuneration. In the US, income may be taxable or nontaxable according to the IRS. Historically, terms like “low income” or “high income” have been used to create implicit racial hierarchies, and using more specific terms can avoid this subtext. For example, phrases such as “income levels have remained stagnant in recent years” or “as of 2016, wealth for Black families was on average only a tenth of a white family’s wealth” can keep focus on individual and family circumstances. In addition, describing jobs as being associated with “higher” or “lower” incomes can be helpful to avoid stereotyping. It’s worth being careful to not equate vocations with income, as many specialized blue-collar jobs can command higher salaries than an average white-collar job in certain areas.
Wealth refers to an individual or household’s total assets, minus their debts, regardless of income. Thus, wealth includes factors like property, real estate, personal valuables, vehicles, etc. Wealth is often conflated with spending habits, which can lead to inaccurate depictions. Focusing on wealth in detail also helps to dispel many of the myths associated with being “rich” in the US since much of it is generational (e.g., passing down houses from generation to generation). Referring to individuals or families as “low wealth” is a more straightforward alternative to terms like “poor” or “struggling,” which may seem to editorialize and may not match a person’s actual experiences.
Additional resources
- Income Definition (Investopedia)
- What Is Taxable and Nontaxable Income? (IRS)
- There’s a Major Difference Between Wealth and Net Worth Vs. Income (Business Insider)
- Wealth Definition – Economics (Investopedia)
Summary
Income refers to payment for one’s work/labor. Wealth refers to the net worth of an individual or household. Wealth is often conflated with spending habits, which can lead to inaccurate depictions. Focusing on wealth in detail also helps dispel many of the myths associated with being “rich” in the US since much of it is generational (e.g., passing down houses from generation to generation). Referring to individuals or families as “low wealth” is a more straightforward alternative to terms like “poor” or “struggling,” which may seem to editorialize and may not match a person’s actual experiences.