Managing Family Income — Flashcards

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Family income is the income from all sources like salary of family members, rents, interest received from banks, and savings from using skills of family members.

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Family income can come from salary, rent, bank interest, part-time classes, sale of shares and other investments, and savings made by using skills at home.

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These activities may not give cash directly, but they save money that would otherwise be spent on tailors, vegetables, or sweaters. Such savings add to family income.

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Free education, free medical facilities, and rent-free accommodation save money for the family. These savings increase the effective income available for other needs.

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Expenditure is the money spent from income for buying various things to fulfil family needs. It reduces the money left for other uses.

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Income brings money into a family while expenditure takes money out so that it is not available for anything else.

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Saving is the money set aside by the family for use in times of need.

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To ensure saving, expenditure must be less than income. When spending stays below income, some money remains for future needs and emergencies.