Definition§
Pin Money is a term used to describe a small amount of cash allocated for incidental or discretionary expenses. This money is generally used for minor purchases that don’t require budgeted spending. Historically, the term was often used to refer to a modest allowance that could be used by women for personal or household items.
Examples§
- Historical Context: A common example from the past would be a wife receiving pin money from her husband to buy small household items or personal accessories.
- Modern Usage: In a contemporary setting, an employee might receive pin money as a part of their per diem to cover daily incidental expenses while on a business trip.
- Contracts: A small cash advance provided in the initial stages of fulfilling a major contract might be referred to as pin money.
Frequently Asked Questions (FAQs)§
1. Is pin money the same as an allowance? Pin money can be considered a type of allowance, but it is usually for incidental and discretionary expenses rather than a regular, fixed amount provided uniformly over time.
2. How did the term “pin money” originate? The term originated in the 17th century when wives were given small sums specifically to buy pins and other personal or household items.
3. Is pin money taxable? The tax treatment of pin money depends on its context. If it is provided by an employer, the specifics of the tax code in the relevant jurisdiction and the nature of the expenses covered may determine its taxability.
4. Can the term pin money still be used in modern financial terminology? Yes, while it is somewhat archaic, it can still be used in modern conversations about finances, particularly in informal or historical contexts.
5. How is pin money different from petty cash? Pin money is intended for personal or household discretionary use, whereas petty cash is a small amount of money kept by organizations for business-related minor expenses.
Related Terms§
- Allowance: A predetermined amount of money given regularly to cover expenses.
- Petty Cash: A small amount of cash on hand used for minor business expenses.
- Stipend: A fixed regular sum paid as a salary or allowance.
- Per Diem: Daily allowance for expenses, typically related to business travel.
- Incidental Expenses: Minor costs associated with pursuing a work-related or personal activity.
Online References§
Suggested Books for Further Studies§
- “The History of Money” by Jack Weatherford
- “Personal Finance for Dummies” by Eric Tyson
- “Your Money or Your Life” by Vicki Robin and Joe Dominguez
Fundamentals of Pin Money: Finance Basics Quiz§
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