net income
Also called: gaji bersih, take home pay
The money received after tax and other deductions.
What it means
Net income is the money actually received after tax, mandatory contributions, and other deductions. This term is also called net salary or take-home pay. This is the figure available for spending, saving, and paying installments.
Why it matters for families
A family budget must be built from net income, not gross salary. Using the gross figure makes savings and installment plans look lighter than reality. As a result, families often run a deficit in the middle of the month.
Example
For example, with a gross salary of Rp8 million, minus tax and mandatory contributions of Rp700 thousand, the net income is Rp7.3 million. If the home installment is planned at 30 percent, the limit is around Rp2.19 million. This figure is safer to use than calculating from Rp8 million.
Common misunderstanding
Many people use the gross salary figure when applying for installments. The correction is that banks and financial planners look at net income because that is the money actually received.