Topic 2 household income Flashcards
What is regular income?
Regular Income is income that is received every week or every month. For example, wages, jobseeker’s benefit.
What is irregular income?
Irregular Income is income that is received now and again, for example, overtime.
How do we plan our expenditure?
As we all have limited amounts of income, we must learn to live within our means by estimating and planning expenditure, based on our income.
It is very important that we manage the income we will have in the future, when we no longer have wages or income from employment. We can do this by paying into a pension plan for example.
What are non-cash forms of income?
People in employment may also receive non-cash forms of income. For example, a salesperson could receive a company car, free motor insurance or free fuel.
What is fixed expenditure?
Fixed Expenditure is defined as items of expenditure where the amount we spend is not related to how much of the item we use. For example, car tax isn’t related to how much we drive our cars.
What is irregular expenditure?
Irregular Expenditure include items of expenditure where the amount we spend changes depending on how much of the item we use. For example, home heating bills.
What is discretionary expenditure?
Discretionary Expenditure is any non-essential item of expenditure, such as a holiday or designer clothing.
What is capital expenditure?
Capital Expenditure refers to long-term spending. For example, a house or new car.
What is current expenditure?
Current Expenditure refers to day-to-day spending. For example, groceries.
What is impulse buying?
Impulse buying is buying something on the spur of the moment without thinking of the consequences.
What is opportunity cost?
Opportunity cost is the cost of buying something or the missed opportunity, we had to do without.
