Your monthly income has now been divided into three parts, as shown in the above image.
The needs and investment parts are simple, but the leftovers part is little challenging. The money in Leftover part will be used for wants/luxury and for expenses which occurs quarterly, semi-annually & annually.
- Wants are non-essential extras for living and working. They include OTT subscriptions, movies, dining out, and so on. These expenses are unplanned and variable.
-There are few expenses which occurs quarterly like your vehicle servicing. While some expenses are semi-annually like Gym membership, OTT subscription etc. Annual expenses include celebrating your birthdays, anniversary, insurance premiums etc. These are planned and fixed expenses, which means you know when you have to pay them.
