discretionary income

  

Definition

Portion of an entity's income available for saving, or spending on non-essentials. It is what remains after expenses for basics (such as food, clothing, shelter, utilities) and prior commitments (such as school fees and loans) are deducted from the disposable income. Total amount of discretionary income in an economy is a key indicator of the level of possible economic growth and is the target of all commercial advertising. Also called hot money.

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