Question

Calculating the Amount Spent on Housing. Calculate approximately how much money an older (age 65-74) household with an annual income of $45,000 spends on housing each year. (Hint: Use Exhibit 18-4)

Answer 1

14,580 is the approximate Amount Spent on Housing.

What is Annual income?

Your yearly income is the sum of money you earn each year. Your income includes your normal salary as well as any overtime pay, tips, commissions, or bonuses that you may have received. There are two alternative phrases that can be used to characterize it: gross yearly income & net annual income.

The amount of money you make each year before deductions is referred to as your annual income. Simply separating the words annual and income to indicate "year" and "money generated" will help you recall the meaning of yearly income. You'll need to show evidence of both your household income and your net annual income when creating a budget, requesting a loan, or determining child support and spousal payments.

$ spent on housing = annual income x average housing % (from a chart)

= 45,000 x 32.4%

= 14,580

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