What Types Of Items Will Your Discretionary Spending Cover?

What is a good discretionary income?

While there are many factors that may affect the percentage of take-home pay that you allocate as discretionary income, the general rule is 30 percent or less..

What is another word for discretionary income?

What is another word for discretionary spending?disposable incomediscretionary incomedisposable personal incomediscretionary expenses

What are expenses examples?

Examples of ExpensesCost of goods sold.Sales commissions expense.Delivery expense.Rent expense.Salaries expense.Advertising expense.

What are examples of monthly expenses?

You likely have a slew of monthly expenses: Mortgage or rent….NeedsMortgage/rent.Homeowners or renters insurance.Property tax (if not already included in the mortgage payment)Auto insurance.Health insurance.Out-of-pocket medical costs.Life insurance.Electricity and natural gas.More items…

What are discretionary spending items?

Discretionary spending refers to non-essential items, such as recreation and entertainment, that consumers purchase when they have enough income left over after paying the necessary expenses such as the mortgage and utilities.

What is discretionary and mandatory spending?

Discretionary spending is spending that is subject to the appropriations process, whereby Congress sets a new funding level each fiscal year (which begins October 1st) for programs covered in an appropriations bill. … Mandatory spending is simply all spending that does not take place through appropriations legislation.

What are the 4 types of expenses?

You might think expenses are expenses. If the money’s going out, it’s an expense. But here at Fiscal Fitness, we like to think of your expenses in four distinct ways: fixed, recurring, non-recurring, and whammies (the worst kind of expense, by far).

What is 10 of my discretionary income?

Discretionary Income Percentage For a simple example, let’s say your annual discretionary income is $12,000 and you’re on PAYE. That means 10% of your discretionary income would be your student loan repayment amount. $12,000 * 10% = $1,200 per year. So, your monthly payment would be $100.

What are the 3 categories of expenses?

Fixed expenses, savings expenses, and variable costs are the three categories that make up your budget, and are vitally important when learning to manage your money properly. When you’ve committed to living on a budget, you must know how to put your plan into action.

What is an example of a discretionary spending?

In American public finance, discretionary spending is government spending implemented through an appropriations bill. Some examples of areas funded by discretionary spending are national defense, foreign aid, education and transportation. …

What is an example of mandatory spending?

Outlays for the nation’s three largest entitlement programs (Social Security, Medicare, and Medicaid) and for many smaller programs (unemployment compensation, retirement programs for federal employees, student loans, and deposit insurance, for example) are mandatory spending.

Is defense spending mandatory?

The United States federal budget consists of mandatory expenditures (which includes Medicare and Social Security), discretionary spending for defense, Cabinet departments (e.g., Justice Department) and agencies (e.g., Securities & Exchange Commission), and interest payments on debt.

What does discretionary mean?

adjective. subject or left to one’s own discretion. for any use or purpose one chooses; not earmarked for a particular purpose: discretionary income; a discretionary fund.

What is an example of discretionary authority?

The federal bureaucracy has discretionary authority to make decisions on what actions to take—or not take—when implementing laws. … Here are a few examples: the Department of Education, Environmental Protection Agency, Federal Elections Commission, and the Securities and Exchange Commission.

How do you spend discretionary income?

Here are five smart ways to invest your tax refund — and reap some big rewards.Pay Off Debt. This is probably the least fun way to spend discretionary income because you won’t have anything tangible to show for it. … Meet With a Fee-Only Financial Planner. … Open a 529 Plan for Your Child. … Invest in Your Home. … Take a Vacation.