Our spending patterns rarely change significantly over time, and they change much less than our incomes do. Making changes to budgets that are tied to our lifestyles is difficult. This is why spending declines less than incomes do during a recession. People don't want to give up what they are used to, even when they can't afford it.

People decide how much money they can spend based on their current and expected incomes. What they actually spend each month or year, however, depends on their lifestyle spending - long-term commitments and buying habits.

Long-term commitments include food (what we need to eat) and housing, for example.






Buying habits are reflected in our diet (what we choose to eat), clothing, and entertainment purchases, for example.