Insurance Terms Defined: Net Income

Net Income: revenue minus expenses and taxes during a given time period.

All insurance companies, like most companies, must keep good records of the income that is produced by the company to budget and profit well.  When determining your business income or your personal income you need to determine what your actual net income is for you and your family.

The process is quite simple and you can do it by adding up all of the income that you and your spouse make in a given month or year.  Now subtract all of your expenses or bills and then subtract the taxes you do or will owe to the federal government.  What you are left with is your net income, meaning you can start a solid budget or planning stage for your family.