Economy and finances

Last updated: 27 11 2018

The word “economy” comes from the Greek word “oikonomos” and means “management of resources”. In other words, planning one’s use of resources to avoid shortages. In this context resources can be money, goods, or other assets.

A person's everyday economy is about maintaining a balance between income and expenses. Salaries and benefits are examples of income. Bills and money for food, clothes and shoes are examples of expenses.

Sometimes unexpected things happen, and when they do it is useful to have some money set aside that you can access quickly if you need it. Otherwise you may have difficulties dealing with the unexpected expense.

One way of planning your everyday finances is to make a basic budget. In your budget you list all your planned income and expenses, which gives you an overview of your finances.

There are many things that can upset the balance of your everyday economy. Spending too much on food, your car, or clothes are common examples. Expensive subscriptions, credit and insurance policies can also make it difficult to keep your everyday economy in balance.