A fuller guide to this term is on the way. In the meantime, the related terms below explain the ideas around it.
Related MoneyPedia terms
- Variable ExpensesCosts that change from month to month based on your choices or usage, such as groceries, gas, or electricity.
- Recurring ExpensesCharges that repeat on a regular schedule, such as monthly subscriptions or annual memberships, whether you use them or not.
- Discretionary SpendingMoney spent on nonessential things you want but could go without, like dining out, hobbies, or entertainment.
- Needs vs. WantsThe distinction between spending you truly must cover to live, like housing and food, versus spending you choose for enjoyment or convenience.
- Cash FlowThe movement of money into and out of your accounts over time, showing whether more comes in than goes out.
- Spending PlanA forward-looking plan for where each dollar of income will go before you spend it, covering bills, saving, and everyday costs.
More in Budgeting & Cash Flow
Plain-English education — not personalized legal, tax, or investment advice.