what is a discretionary expense

A discretionary expense is a non-essential expense that can be survived without if necessary. It is often defined as nonessential spending, meaning that it is not essential for the operation of a home or a business. Discretionary expenses are usually linked with improving a companys reputation among its customers and employees. Examples of discretionary expenses include meals at restaurants, entertainment costs, vacations, luxury items, and other services. Discretionary expenses are paid for with discretionary income, which is the amount of money left over after paying for housing, food, taxes, and other necessities. In a corporate environment, discretionary expenses are usually costs linked with promoting or boosting a companys standing in the market. Discretionary expenses are different from non-discretionary expenses, which are bills such as rent, mortgage payments, and utilities that must be paid. Proper management of discretionary expenses is crucial for maintaining financial stability and achieving financial goals.