Fixed expenses: definition, 25 examples and a monthly worksheet

The short answer: fixed expenses are costs that stay the same, or nearly the same, every month, like rent, a car payment, insurance and subscriptions. They show how much of your income is already spoken for.

• Fixed vs. variable: rent and insurance stay the same; groceries, gas and dining out change with use
• Budget for them: list every one, convert periodic costs to monthly, add them up and subtract from take-home pay
• Match due dates to paydays and set up autopay
• 25 examples and ways to lower them are below
• Next step: Plan it with the Bill Tracker Spreadsheet ($4.99).

Fixed expenses, often called fixed monthly expenses, are the costs that stay the same, or nearly the same, every month, like rent, a car payment, insurance and subscriptions. Knowing your fixed expenses is the first step in any budget, because they show how much of your income is already spoken for before you buy a single grocery.

Want a fixed expenses list that keeps itself current? The Bill Tracker Spreadsheet ($4.99) tracks every bill's due date and payment in Excel or Google Sheets.

This guide explains the definition, gives 25 fixed expenses examples you can use as a checklist, compares fixed and variable expenses, and shows how to budget for and lower your fixed costs. New to budgeting? Start with budgeting for beginners.

Fixed expense definition: what counts as fixed

A fixed expense is a regular cost with a set amount, usually because you've signed a contract or agreed to a plan. You pay it whether or not you use it much that month. Fixed expenses are predictable, which makes them easy to plan for, but they are also harder to change quickly.

The opposite is a variable expense: a cost that changes with how much you use or buy, such as groceries, gas or dining out.

25 examples of fixed expenses

Housing

1. Rent
2. Mortgage payment
3. HOA or condo fees
4. Renters or homeowners insurance
5. Property tax (often paid yearly or through your mortgage)

Transportation

6. Car loan or lease payment
7. Car insurance
8. Public transit pass
9. Parking permit
10. Annual vehicle registration

Insurance and health

11. Health insurance premium
12. Life insurance premium
13. Disability insurance premium (see our guide to disability insurance)
14. Dental or vision insurance

Debt payments

15. Student loan payment
16. Personal loan payment
17. A planned credit card payoff amount

Family

18. Childcare or daycare tuition
19. Child support or alimony
20. School tuition

Bills and subscriptions

21. Phone plan
22. Internet
23. Streaming services
24. Gym membership
25. Software or app subscriptions

Fixed vs. variable expenses

For the other half of the budget, our guide to variable expenses has 30 examples, typical household costs and a 5-step way to budget them.

Some costs sit in between. Utilities like electricity change with the season, so they're usually variable, though a budget billing plan can make them fixed. Our guide to budget categories shows where each type of cost belongs.

What are variable expenses?

Variable expenses are costs that change from month to month based on how much you use or buy. Common examples of variable expenses are groceries, gas, dining out, entertainment, clothing, household supplies, gifts and most utilities. Because you control them day to day, variable expenses are usually the fastest place to free up money when a month runs tight.

A good rule of thumb is to budget fixed expenses first, then give variable expenses a realistic limit based on your last few months of spending, not your best month.

Periodic fixed expenses: the ones that sneak up on you

Some fixed costs come once or twice a year: car registration, insurance paid every six months, property tax, annual subscriptions and memberships. They're easy to forget because they're not on your monthly statement.

The fix is simple: add up every periodic expense, divide by 12, and save that much each month in a sinking fund. When the bill arrives, the money is already there. A sinking fund tracker works out the monthly amount for each one.

Fixed monthly expenses worksheet: a worked example

Here is what a fixed monthly expenses list looks like once periodic bills are converted to a monthly amount. The figures are an illustrative one-car household, not national averages; swap in your own numbers from your statements.

On a take-home pay of $4,800 a month, $2,415 in fixed expenses is about 50% of income, right at the needs share in the 50/30/20 guideline below, before groceries, gas and utilities. The three yearly bills add only $115 a month, but forgetting them is how a $1,080 insurance renewal turns into a credit card balance. Set that $115 aside each month in a sinking fund so the yearly bills are already paid for when they arrive.

Traceable fixed expenses in business accounting

You may also see "traceable fixed expenses" in a business or accounting class. A traceable fixed expense is a fixed cost that exists only because of one segment of a business, such as one store, department or product line, and would go away if that segment closed: for example, the salary of a manager who runs only that store. A common fixed expense is shared across segments, like headquarters rent, and stays even if one segment is dropped. Household budgets do not need that split, but the idea is similar: a car payment is "traceable" to owning the car and ends when you sell it.

How much of your income should go to fixed expenses?

There's no perfect number. The popular 50/30/20 budget suggests about 50% of after-tax income for needs, a group that includes most fixed expenses along with essentials like groceries and utilities. If fixed costs alone take more than half your take-home pay, the rest of the budget will feel tight. Housing and transportation are usually the biggest fixed costs, so they matter most. Use how much rent can I afford to check housing.

How to budget for fixed expenses

1. List every fixed expense with the amount and due date. Check bank and card statements for the last three months so nothing is missed.
2. Convert periodic costs to monthly by dividing yearly amounts by 12.
3. Add them up. This is your monthly fixed cost total.
4. Subtract from take-home pay. What's left covers variable expenses, savings and debt payoff.
5. Match due dates to paydays. If several big bills land before one payday, ask to move a due date, or use a paycheck budget planner.
6. Set up autopay for bills that never change, and keep a bill tracker so you know what's coming.
7. Review once a year. Prices for insurance, internet and subscriptions often creep up at renewal.

The Annual Budget Spreadsheet ($6.99) works in Excel and Google Sheets, with a setup tab for your categories and plan and 12 monthly tabs showing planned vs. actual by category, so fixed costs are entered once and checked every month, and the Bill Tracker Spreadsheet ($4.99) tracks due dates and payments. Prefer paper? The Budget Planner Printable ($5.99) has monthly budget and bill pages. If you want every dollar assigned, see the Zero-Based Budget Spreadsheet ($6.99) and our guide to zero-based budgeting.

What fixed expenses look like in a typical household

The Bureau of Labor Statistics Consumer Expenditure Surveys show housing is the largest share of spending for most U.S. households, followed by transportation and food. That lines up with what most people find when they list their fixed costs: rent or mortgage first, then a car payment and insurance.

Winter bills climbing? Here's how to lower your heating bill without being cold.

Use that as a quick gut check. If your housing alone takes half your take-home pay, the rest of the budget will always feel tight, no matter how carefully you shop for groceries. That doesn't mean you have to move tomorrow. It means housing is the line to look at first at your next lease renewal or refinance window.

A few more ways to make fixed expenses easier to live with:

• Line up due dates with paydays. Many lenders and utilities let you pick a due date. Moving a bill a week later can stop the scramble at the end of the month.
• Keep one list of every fixed bill. Write the amount, due date and how it's paid. It takes ten minutes and you'll spot forgotten subscriptions right away.
• Build a small buffer. Even $100 in checking covers a bill that posts a day early. The CFPB's guide to building an emergency fund has simple ways to start one.

How to lower your fixed expenses

Cutting a fixed cost once saves money every month after. Places to look:

• Insurance. Compare quotes every year or two and ask about bundling or raising a deductible you could afford to pay.
• Phone and internet. Call to ask for a better rate, or switch to a lower plan or a different carrier.
• Subscriptions. Cancel anything you haven't used in a month.
• Loans. Refinancing can lower a payment when rates or your credit have improved; compare total cost including fees.
• Housing and cars. Bigger changes, but worth considering when a lease or loan ends.

More ideas are in how to lower monthly bills and needs vs. wants, which helps decide which fixed costs are worth keeping. For the rest of the money picture, see our personal finance basics hub.

Not sure how big your fixed costs should be? Our budget percentages guide shows a typical share of take-home pay for each category.

Fixed and variable costs add up to your total living expenses; see our guide to living expenses for the average U.S. budget by category.