Recession-Proofing Your Budget: Fixed vs Variable Expense Analysis

General
1

I’ve been categorizing my expenses in Beancount to understand what I can cut if my income drops.

Here’s my approach:

Fixed Expenses (Can’t Cut Easily)

Expenses:Housing:Rent
Expenses:Insurance:Health
Expenses:Utilities:Essential

Variable Expenses (Can Reduce)

Expenses:Food:Dining-Out
Expenses:Entertainment
Expenses:Shopping:Non-Essential

Tracking Flexibility

I tag expenses by necessity level:

2026-02-27 * "Groceries" #essential
  Expenses:Food:Groceries  150.00 USD
  
2026-02-27 * "Restaurant" #discretionary
  Expenses:Food:Dining  60.00 USD

This lets me query spending by category:

  • Essential expenses (can’t cut): 70% of budget
  • Discretionary (can reduce 50%): 20%
  • Luxury (can eliminate): 10%

In a recession, I know I can reduce spending by 15-20% without major lifestyle changes.

2

Good categorization! I’d add one more level: Semi-Variable Expenses - things you can partially reduce but not eliminate.

Examples:

  • Utilities (can reduce usage, can’t eliminate)
  • Insurance (can increase deductibles)
  • Phone/Internet (can downgrade plans)

Track these separately in Beancount so you know your realistic floor.