What Is A Fixed Expense

These expenses are paid at regular intervals and the amount doesn’t change too much. You could have fixed expenses that you pay weekly, monthly, quarterly, or annually.

Example of a Fixed Expense

Here are some examples of fixed expenses:

Mortgage or rent paymentsLoan paymentsChildcare costsTuition paymentsInsurance premiums

These bills don’t have to occur monthly to be considered fixed expenses. For instance, let’s say you have a life insurance payment that you make quarterly. This would be a fixed expense since the amount doesn’t change.

Fixed Expenses vs. Variable Expenses

Fixed costs tend to account for a larger percentage of most people’s budgets, but that doesn’t mean variable costs are any less important. Many variable costs are essential budgeting items, such as food and electricity.

Mortgage or rent paymentsLoan paymentsInsurance premiumsChildcare costsTuition fees

Since these bills stay the same, it’s easier to budget for them each month.