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Your Expense Priorities are All Messed Up
A Truthful Look at Our Spending Mistakes and Blind Spots
The 4 Expense Categories
There are essentially four types of expenses we all have, starting from the bottom, which are:
- Basic Needs Expenses
These expenses are usually low, at least in industrialized countries, with no wars or political unrest. Basic costs include mortgage or rent, food, gas, and clothing. If you live in a household, they may be even lower since you share them with the other adults. We can also include mandatory expenses like taxes, insurance, medical bills, primary education, and emergency savings in this category. Generally, quality living costs are the main factor determining which country one would prefer to live in.
- Social Class Expenses
Social class expenses are the highest variable among all expenses, and unlike basic costs, they are entirely up to your standards. Social class expenses depend on one’s ego, choice of living location, personal comfort, levels of materialism, and desires to keep up with a lifestyle that you believe will impress your social circles. Don’t confuse these expenses with Basic Needs. You choose whether to live in an overpriced house, eat overpriced food, and pay for overpriced clothes…
