Disposable income is the total personal income minus current personal taxes. In the definition of a national account, personal income minus personal taxes is currently equal to one-time personal income. Reducing personal expenses (which includes the main categories of personal or personal consumption expenditures) produces personal (or, private) savings, then the remaining income after paying all taxes is referred to as disposable income.
Restated, consumption plus savings expenditure equals disposable income after accounting for transfers such as payments to children in school or living arrangements and care of elderly parents.
The marginal propensity to consume (MPC) is part of the change in disposable income consumed. For example, if disposable income rises $ 100, and $ 65 from $ 100 is consumed, MPC is 65%. Restated, the marginal propensity to save is 35%.
For the purposes of calculating the amount of income charged by garnishments, United States federal law defines disposable income as an individual compensation (including salary, overtime, bonuses, commissions and paid leave) after deduction of health insurance premiums and the amount necessary to deduct by law. Amounts to be deducted by law include federal, state and local taxes, unemployment and disability taxes, social security taxes, and other garnisemen or levies, but excludes deductions such as voluntary pension contributions and transportation deductions. The reduction will only be done after calculating the amount of garnishment or retribution. The definition of disposable income varies for country purposes and local garnishments and levies.
According to the Better Life Index study conducted by the Organization for Economic Co-operation and Development (OECD), the United States has the highest average household income of all OECD member countries in the world.
Unlicensed earnings are disposable income (after income tax), minus all payments needed to meet current charges. This is total personal income after taxes and minimum living expenses (such as food, medicines, rent or mortgage, utilities, insurance, transportation, property maintenance, child support etc.) To maintain a certain standard of living. This is the amount of individual income available to spend after the important things have been addressed:
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- Discretionary income = gross income - tax - all required payments (bills)
Regardless of the above definition, disposable income is often incorrectly used to denote discretionary revenue . For example, people typically refer to disposable income as the amount of "toy money" left to spend or keep. Consumer Leverage Ratio is the expression of the ratio of total household debt to disposable income.
Video Disposable and discretionary income
References
Maps Disposable and discretionary income
External links
- Simple money-saving calculator - even though it says it measures "disposable income," using the language of an economist, it is free income.
- Eurostat, Press Release No. 60/2010, Household Saving, and Disposable Income, 30 April 2010
- Eurostat, Statistics Explained, Glossary article: National Disposable Income
- OECD disposable income statistics
- Google - public data: GDP and Personal Income (annual): Personal Income Disposal
- Google - public data: GDP and Personal Revenue (annual): Private Income Disposal per capita
Source of the article : Wikipedia
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