1. Household Expenditure
Chapter 2

3. What is expenditure?
Expenditure is money that goes out of the household or business
We must plan for what money we have to spend to make sure we have enough

4. Types of Household Expenditure
Fixed Expenditure
This is expenditure that stays the same every month e.g. Rent, Mortgage, Loan Repayments, Milk bill
Irregular Expenditure
This is expenditure that changes every month e.g.. ESB, Telephone, Gas bills. 

5. Types of Expenditure Discretionary Expenditure
This is expenditure on once off or luxury items e.g.. Holidays, Cd’s, Designer Clothes, Concert Tickets, Computer Games

6. State whether the following are Fixed/Irregular/Discretionary

7. Categories of Expenditure
Current Expenditure
This is expenditure on day-to-day items (ie. Things that last a short time). Eg. Food, petrol, phone credit

8. Categories of Expenditure
Capital Expenditure
This is expenditure on long term items items/assets such a house, a car, a washing machine

9. Impulse Buying
This is when you buy goods that you did not plan too. Buy on the spur of the moment
Eg. You go into a shop to buy a paper and come out with a drink and bar of chocolate

10. Financial Cost v Opportunity Cost
Financial cost is the actual cost of the item you bought. E.g. Mars Bar for €1.
Opportunity Cost is the cost of missing out on the opportunity of having another item instead.
Eg, you have a choice between a Mars and a Twix, they both cost €1 each but you only have €1, so you buy the Mars. The opportunity cost is the Twix. VS

11. False Economies
This is when you buy something that appears to be better value, but in the long run turns out to be more expensive
Eg. Handbag in Penny’s for €15 V’s Brown Thomas €100. The cheaper bag appears better value but is ‘probably’ poorer quality.

12. Importance of keeping a record
As we seen in our income chapter, it is important for families to keep records of money coming in. It is equally important for households to keep a record of money going out
As we move through the course, we will be looking at how to prepare accounts such cash books and budgets and how to present this data showing the differences between income and expenditure figures

13. Classwork
We will use the handout to test our knowledge of this chapter and hope to be able to answer all questions in relation to income and expenditure.