Family Economics and Consumer Education

Family Economics And Consumer Education 3 (2+1)

Lesson 04 : Family Income

The following factors help to overcome the rise in price

1. Skill of house wife: The expenditure of house depends upon house wife . If she spends the money carefully she can save money.
   Eg: Buying the things according to the season, co-operative purchasing of vegetables and provision. Thoughtful planning and careful shopping can ensure that the family does not forego any of the basic necessities and is not too uncomfortable.
2. By using means of supplementing income
3. Co-operation from other family members: If all members of the family co-operate with each other, then money can be saved.
   Eg: Teaching children themselves instead of keeping tuitions.
4. Use of community facilities: If the facilities provided by the government are used to maximum then money can be saved. Ex: Using public libraries instead of taking magazines personally.

Psychic Income: Psychic income can also be called enjoyment income.
Psychic income consists of satisfaction derived by persons from the use of their real income. This type of income is purely subjective and intangible. The quantity of psychic income depends on the skill that is exercised in managing their everyday living. If a person manages his resources better than his neighbor he will have better satisfaction and hence his psychic income is more. Similarly in case of two families having similar size, income, living and environment conditions, one of them may enjoy higher psychic income by managing their resources better than the other.
Total Income
Total income of a family consists of Money income, Real income and Psychic income.

In addition to the above three components of total income there is additional form of income which has not been turned into economic goods. This additional money income may be assigned to three different uses.

• Payment of taxes
• Savings for the future or
• Gifts to persons outside the family.