Discretionary spending refers to the portion of a budget that is not essential for basic living expenses. This includes expenses like dining out, entertainment, vacations, and luxury items. Unlike fixed costs such as rent or utilities, discretionary spending can be adjusted based on personal preferences and financial situations. Individuals and families often allocate a certain percentage of their income to discretionary spending to enhance their quality of life. This type of spending can vary widely among different people, influenced by factors such as income level, lifestyle choices, and financial goals.