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Spending is the process of paying for value. This can be accomplished with the outlay of cash or the assumption of a liability. Spending has four basic types that can be applied to individuals, families, firms and governments.Non-discretionary SpendingPersonal non-discretionary spending is spending that is required to maintain your standard of living. Corporate and government non-discretionary spending relates to obligations such as loan repayments or public education. For example:Clothing | Education | Food | Healthcare | Rent | Transportation |
Discretionary SpendingPersonal discretionary spending is optional spending that mostly relates to improvement, experience, social status and growth. Corporate and government discretionary spending relates to strategy such as research & development or infrastructure spending.Entertainment | Hobbies | Home Improvement | Interests | Luxuries | Restaurants | Streaming Media | Vacations |
Fixed ExpensesFixed expenses are predictable obligations that must be paid at regular intervals such as monthly or yearly. Spending on fixed costs is more or less automatic and there may be penalties for failure to meet these obligations. In many cases, fixed costs can be canceled with notice.Insurance | Loan Payments | Rent | Subscriptions | Taxes (e.g. Property Taxes) | Vehicle Lease |
Variable ExpensesVariable expenses are costs that fluctuate or are unpredictable. For example, an electricity bill that is different each month.Entertainment | Food | Fuel | Out-of-pocket Medical | Repairs & Replacement | Utilities |
Expenses
This is the complete list of articles we have written about expenses.
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The definition of expense with examples.
A list of common types of business expenses.
A list of common travel expenses.
A list of categories of personal expenses.
The definition of discretionary expenses with examples.
A list of common household expenses.
A list of common fixed expenses including business and personal examples.
A list of the common types of current asset.
A list of common variable expenses including business and personal examples.
A list of common quality of life considerations.
The definition of rights with a list of examples.
A list of the basic types of toys.
The definition and measure of standard of living with examples.
A list of common leisure activities.
A list of common recreational activities.
A list of common types of entertainment.
A list of common sports.
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