Fixed expenses are ongoing fees and set bills such as a monthly mortgage. Amounts that remain the same, or fixed expenses, should be placed on your budget each cycle. Fixed expenses include housing or membership dues.
Variable expenses are fees that can change. Amounts that may vary, variable expenses, should be estimated based on previous cycles’ totals. Variable expenses include dining or social events. Examples include your grocery bill or t-shirt orders, varying based on sales or the number of members.
You should be able to make these estimates based on previous cycles’ totals (look at last year’s cost, what was spent, and come up with a reasonable estimation of what you think it will cost). You can also review your vendors and see the actual cost vs. the projected cost for the year.
NOTE: Income should ALWAYS be higher than Expense
Pro Tip: Always lean towards overestimating and make the estimated amount as realistic as possible.