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Chapter 03

Household Expenditure

QuestionAnswer
Expenditure def The way people spend their income
Three types of expenditure + definitions Fixed: same amount spent on regular basis, eg mortgage Irregular: less regular basis, amount Varys, eg groceries Discretionary: spending on non essential items, eg holiday Capital: once off/long term, eg car Current: day-to-day spending, eg rent
Guidelines to effective spending Prepare a budget Prioritise expenditure Avoid impulse buying Beware of false economies Opportunity cost
Solutions to overspending Cut back on spending Postpone non essential spending Spend large payment over long period of time Extra income Savings/surplus money
Cash flow def Day to day money coming into or going out of a household
Created by: TomDel123
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