When you mark a category as an Essential Expense - by clicking the adjacent checkbox in the budget tree - you are telling the program that the amount associated with this category should not be rescaled when adjusting the budget total (on the Rescaled Budget tab). It is equivalent to the term non-discretionary used in other contexts.

Note: It is only possible to change the Essential Expenses checkboxes when viewing the budget tree on the Edit Original Budget tab. The checkboxes are not enabled on the Rescale Budget tab.

Typically Essential Expenses are categories related to Food, Housing, Health, Education, Transport, etc. If you decide that the majority of your budget categories are Essential Expenses, use the Mark All button and then uncheck those categories which are not Essential Expenses.

Bear in mind that if you later want to reduce your budget total from its original value, the only scope for reduction lies in the total amount allocated to non-essential expenses. To take an extreme example, if you mark all your categories as Essential Expenses, and then try to reduce the total by rescaling, the program will produce the following error message: