How level of spending is determined.

[TOZZIBLINKZ]

Human beings spend money in order to acquire assets and acquire things they desire or admire , spending by definition refers to the total quantity of goods and services purchased and used by consumers during a specified period of time . spending is also described as expenditure on goods and services at a given period of time it is the expression of total consumer demand . In today's world spending could be done on durable goods which include furnitures and machine or on non-durable goods which include food clothing water , finally it could be done for the sake of some services like legal fees , medical fees , entertainment fees , and educational fees etc .

For you to spend your savings speaks for you , this is so true Because savings influence spending and high savings tend to reduce level of spending and vice versa . Income of the spender also determines his or her spending it is important to know that higher-income leads to higher level of spending but lower income therefore leads to lower level of spending.

Higher rate of taxation reduces the income of people and this reduce the level of spending.

Future expectation of goods to rise in price in the future you lead to a rise in the level of spending expenditure and vice versa .

 

[Kingsley]

Some times people consider their income after tax when making their budget. They define their savings as income after tax minus their expenditures. So in other words they always place a priority on their expenditures over their savings. Although there are other people who sees deductions of their savings as the paramount thing to do before expenditures, this class of people live more frugally. As they place themselves in a very tight corner in other to get enough money to save.

Anyway I think the level of spending is basically determined by the rate of our expenditures, we naturally put our basic needs as a priority like the need for clothing, shelter and food, these three fundamental needs are what actually determines how we utilize our hard earn resources.

Though there might still be other pressing needs like need to attend school, needs to visit a hospital. And there are other things that may come up which are not technically planned.

The economic situations has made it difficult to have the ability to have savings in any way due to the hardship, those below the poverty lines has even find things very difficult to even meet up with their daily needs .