Fixed expenses are costs that do not change from month to month, such as rent or mortgage payments, car payments, or insurance premiums. These expenses are typically necessary, predictable, and non-negotiable, forming a stable part of an individual's or organization's financial obligations. On the other hand, variable expenses fluctuate from month to month based on usage or consumption. Examples include groceries, dining out, entertainment, and utility bills. The amount spent on these items can often be adjusted according to financial goals or current financial status, providing a degree of flexibility within the budget. Understanding the distinction between these two types of expenses is crucial for effective budgeting, as it allows for better financial planning, spending control, and potential savings.