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Expenditure (How to avoid Overspending (*do not spend more money than you…
Expenditure
What is expenditure?
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Goods and services can be paid: every week (travel cost) once a month(rent) every two months(electricity bill) once a year(tax)
Opportunity cost
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Often the choice we have to make is between items. The item we do not buy is called the opportunity cost
Impulse Buying
Impulse Buying is we someone buy items without planning and without asking ourselves if we can afford or need the item.(unplanned spending)
It is also important to be aware that shops encourage us to buy more than we need for example: magazines and sweets at checkout, discounts and sales and 3 for the price of 2 etc.
Overspending
An individual or household's expenditure should not be more than their income. This is called overspending.
Consequences of overspending include: not having enough money to pay bills - being unable to save for the future - no money set aside for unexpected events
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Types of Expenditure
Fixed Expenditure
Fixed expenditure is payment on a regular basis, such as once a week, month or year
Irregular Expenditure
Irregular Expenditure is payment where the amount and/or depends on how much the goods or services are used
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