What Are the Different Ways People Earn Money?

Teacher Tips

Hook

• Display the three earners and ask "These three people each made £500 in different ways. Who keeps the most, and how do you know?" Give the full minute to think and discuss, and take views from different learners before you reveal anything. Most will pick the one who seems to have the most, or the one who never had a deduction. Let those answers stand, because the reveal is about to test them.
• The payslip, invoice and dashboard only tell part of the story, as they don't show how much ends up in a bank account. The speaker notes explain it, and it's the trickiest explanation in the session, so they're worth reading beforehand. In short, the employee's tax was taken through PAYE before the £500 arrived, so what lands is already the net figure. The freelancer receives the full £500, but around 20–30% of it needs setting aside for tax. The seller may keep every penny, because the first £1,000 a year of trading income is tax-free.
• Then ask "Are employees or freelancers better off?" and give a minute to discuss. There's no right answer, and the reveal says so: each has advantages and disadvantages, and the tax is paid in different ways and at different times.
• Give learners a way of thinking about "better off" that you can come back to all lesson. Each income type is a different set of trade-offs: security against flexibility, certainty against potential, simplicity against responsibility. If anyone picks a winner, ask "Better for whom, and in what way?"

ITZA Pathways

• Pathway 1 (Tax: Different Ways To Work) covers PAYE versus self-employment: who pays the tax, and the advantages and risks of each. Pathway 2 (Side Hustles) covers what counts as a side hustle, the trading allowance, and combining income streams. Learners met PAYE and Self Assessment in Session 10, so it's worth asking what they remember before they start.
• As you circulate, ask "If you could earn money from something you already enjoy, what would it be?" Then follow up with "How would you make it work financially?" and "Who would sort out the tax, you or someone else?"
• Check the freelancer set-aside calculation as you go round. If a freelancer earns £500 and needs to set aside 20–30%, that's £100 to £150. A learner who says "they keep £500" hasn't yet seen that the money isn't all theirs.
• If a learner says selling their own old clothes isn't taxed, they're usually right. Selling personal possessions isn't trading, and the trading allowance applies when someone buys or makes things in order to sell them for profit. If it comes up, that distinction deserves 30 seconds.
• For learners who need a way in, connect the income types to creators or entrepreneurs they already follow, or a young person they know who earns money. Faster learners can use the AI Buddy to design a personal income plan that combines employment with a side hustle. Early finishers can move on to the Side Hustler Minigame once they've been through both pathways, as a bonus rather than a race to the end.

Classroom Activity

• Different Ways to Earn has two tasks. In Income Inquest, groups copy three columns (employed, self-employed and side hustle) and sort jobs into them in 3 minutes. Say up front that some jobs could fit more than one category. That's the point, not a trap, and it's where the best discussion comes from.
• Take feedback after the first sort and ask for justifications, not just placements. A sentence stem helps: "We put ___ under ___ because ___." Pick a job the groups disagreed on and ask both sides to argue their case.
• For a job that could go either way, such as a delivery rider or a tutor, ask "What would have to be true for it to be employed, and what for it to be a side hustle?" The set-up decides the category, not the job title.
• While groups work, a few questions to drop in: "Who pays this person?" "Do they have a boss, or clients and customers?" "Who is responsible for sorting the tax?" "Which option gives more freedom, which more security, and which more risk?"
• Then repeat the sort for another 3 minutes, this time with the advantages and risks for each type. The security-against-flexibility pairs from the hook are a useful way in, so put them back on the board.
• For 1 Skill; Many Ways to Earn, talk through the examples on the slide first. Baking is the model: a job in a bakery, a cake-making business, and cupcakes sold at local events. If groups need a second example, photography could be a school photographer, a wedding photographer, or photos for friends and family.
• Give 3 minutes to think of as many ways as possible to earn from one or two chosen skills. Push for range in two directions: at least one idea in each of the three types, and more than one within a type. It helps if groups choose skills they actually have.
• For the debrief: "Which skill had the most earning options?" "Which route felt most secure?" "Which gave the most freedom?" "Which carries the most risk?" "Which might mean sorting your own tax or records?"

Plenary

• Part 2 asks learners to design their ideal income setup at 25 using employed, self-employed and side hustle work. Push for one detail that shows real understanding: who sorts the tax in each stream. For employed, it's the employer, through PAYE. For freelance, and for side hustle income above the £1,000 allowance, it's the learner, through Self Assessment.
• The lock-in is from Brian Tracy, an author and motivational speaker: "Your earning ability today is largely determined by your knowledge, skills, and your ability to apply them in your work. To earn more, you must learn more." Connect it to the skills task by asking "Which skill would you build to open up more of the options you found today?"
• The line on the slide after the quote brings it back to the session: there isn't just one way to earn money, every income choice comes with different freedoms and responsibilities, and the more you understand your options, the more control you have over how you build your financial life.