Make the most of your discretionary income

Discretionary income is what you have left over after paying your fixed costs. It’s yours to spend on whatever you choose.

Aim…

How you spend this money can make a difference in your financial situation, but before that we need to determine what discretionary income is.

rent/fees

Car running costs

Force

debt

groceries etc.

People who have some type of addiction will prioritize their expenses so that the addiction is included among their fixed expenses.

Everyone as an adult has freedom of choice unless they are in debt, which means their freedom is eroding relative to their level of debt.

The old proverb, “The borrower is the slave of the lender,” sums it up.

We all have some control over most of our fixed expenses, like groceries and energy; we can reduce them, but with things like fees or rent being fixed, we can still choose to live in a more modest apartment or downsize.

The excess of your expenses is called discretionary income.

Another way to increase your disposable (discretionary) income is to increase your income by getting a part-time job, getting a higher-paying job, or selling things online.

Saving your discretionary expenses for a greater purpose instead of sintering them gives your life meaning. Instead of just letting things happen, you are making things happen. Many people 10 to 20 years from now wondered what happened.

There is a big difference between saving your money and investing it. Shrewd investors use their discretion to increase their wealth by investing in riskier stocks and stocks, gold, and cryptocurrencies. There are enough platforms online where you can pump money into these things if you’re still climbing the investment ladder.

But then you might prefer to save up for a vacation and check off an item or two on your wish list. Border closures will restrict your choice of venues, but here in New Zealand there are so many great places to visit that it’s an opportunity to discover your own backyard.

Among the most popular activities in New Zealand are landing on the Franz and Fox Glaciers, taking a dip in the hot pools of Hanmer Springs, visiting the Marlborough wine region or attending one of the country’s sporting meets. One thing I have to mention here is the Tranz Alpine Express train journey between Christchurch and Greymouth. It is rated as one of the best train rides in the world and having experienced it, I don’t disagree. It has to be on everyone’s wish list.