Definition : Disposable income

Disposable income refers to the amount of money that an individual or household has available for spending or saving after taxes and necessary expenses have been deducted. It is the income that can be used for discretionary purchases, such as leisure activities, luxury items, or investments. This type of income is not essential for daily living and can be easily “disposed” of, hence the term disposable income. It is an important measure of an individual’s financial well-being and can greatly impact their ability to make choices and improve their quality of life. Disposable income is often used as an indicator of economic health and consumer spending patterns.

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