Lesson 2.8, one day, 13 slides. Wage and prices marked [update].
Do now
- Every way a person your age can get money.
- Every way an adult can.
- Two columns. Two minutes. As many as you can.
Teacher notes
Sort the answers on the board into EARNED and NOT EARNED as students call them out.
Where money comes from now
- Allowance. Chores a relative pays for.
- Babysitting. Dog walking. Mowing. Tutoring.
- Selling things you made or no longer use.
- Gifts.
- Which of these did you do work for?
Teacher notes
Image: a teenager walking two dogs on a sidewalk.
Where money comes from later
- Wages: paid by the hour. $17.00 an hour on Long Island in 2026 [update].
- Salary: a set amount for the year, split into paychecks.
- Tips. Commission. Overtime. A second job. A business you own.
- Later: interest and dividends from money you saved and invested (Topic 2.4).
Teacher notes
Image: a pay stub, a tip jar, and a piggy bank in a row.
The first formula
- Hourly rate x hours worked = gross pay
- $17.00 x 24 hours = $408.00
- Copy it. You will use it in three minutes.
The hook
- Dana is 16. She works at a bagel shop.
- The posting said $17 an hour. She worked 24 hours.
- She did not get $408.
- Where did it go?
Teacher notes
Image: a bagel shop counter with a hand-written "Now Hiring" sign.
Gross and net
- Gross pay: what you earned.
- Net pay: what you keep. This is the number that lands in your account.
- Gross minus deductions = net.
- You budget with net. Never with gross.
The four deductions
- Federal income tax: the national government. Defense, highways, the weather service, national parks.
- New York State income tax: state roads, aid to schools, state parks.
- Social Security: 6.2 percent of gross. Pays retired and disabled workers now. Someone will pay yours.
- Medicare: 1.45 percent of gross. Health coverage for people 65 and over.
Teacher notes
Say plainly that a teen's first stub may show $0 federal and state tax because the income is low. Social Security and Medicare are always there.
Two quick checks
- Thumb up if this is true: net pay is bigger than gross pay.
- Thumb up if this is true: Social Security is the same percent for every worker in the country.
Teacher notes
First is false, second is true. Ask one student to say why for each.
Be the detective
- Pairs. Calculators.
- Compute gross. Add the four deductions. Subtract. Check against the printed net.
- Then: percent taken out, and the four detective questions.
- 14 minutes.
The stub, labeled
- Line 1: what she earned.
- Lines 2 to 5: what came out.
- Line 6: what she kept.
- Total deductions: add all four first, then subtract once.
Teacher notes
Image: the sample stub with three colored brackets around lines 1, 2 to 5, and 6.
The answers
- Gross: $408.00. Deductions: $67.94. Net: $340.06.
- About 17 cents of every dollar left before she saw it.
- Largest deduction: Social Security, $25.30.
- A year of these: $8,841.56 take-home.
Teacher notes
Reveal after three pairs report.
Think about it
- Social Security comes out of a 16-year-old's check. She will not see it for 50 years. Fair?
- Two people, same gross. Can their net be different?
- Her hours get cut from 24 to 16. What happens to net? What happens to her budget?
Exit card
- 3 sources of income you could have in the next two years
- 2 deductions that come out of every paycheck in the country
- 1 sentence: what does "net" mean?
- Tomorrow: net pay goes into a budget. Bring your $100 sheet from Lesson 2.7.