What are variable expenses?

Variable expenses refer to costs that can change from month to month depending on factors such as usage, consumption, or personal choices. This includes items like electricity bills, gas for a vehicle, groceries, and entertainment. Unlike fixed expenses, which remain constant (like rent or mortgage), or emergency expenses that are unpredictable, variable expenses allow for more flexible budgeting since they can be adjusted based on one's financial situation or spending habits during any given month. Understanding variable expenses is essential for effective budgeting, as it enables individuals to manage their cash flow more dynamically and respond to changes in their financial circumstances.