What are fixed expenses?

Fixed expenses refer to consistent costs that do not fluctuate significantly over time. These expenses are predictable and generally remain stable regardless of individual usage or consumption levels. Common examples of fixed expenses include rent or mortgage payments, insurance premiums, and certain subscription services.

Understanding fixed expenses is crucial for personal finance management, as they represent a portion of your monthly budget that you can rely on and plan around. Unlike variable expenses, which can change from month to month due to consumption patterns or lifestyle choices, fixed expenses offer stability in budgeting and financial planning. Knowing your fixed expenses helps you in assessing your overall financial situation and planning for savings or discretionary spending.