It’s important to distinguish between expenses. Things are great in moderation, especially when that means you can live a more fiscally comfortable life as a result of your smart spending.
To utilize this page, familiarize yourself with these distinctions:
- Fixed expenses: These are the necessary expenses that remain the same each month (including rent, car payment, and insurance). You generally need to make big changes in your life to impact these expenses.
- Flexible expenses: These are the necessary expenses that vary each month, including your utilities and weekly grocery bill. You can lower these expenses by changing your habits.
- Discretionary expenses: These are personal expenses where you have more control over what and how much to spend. This category can include trips to the coffee shop, nights out at the movies, and trips to restaurants with friends.