Why separate fixed and variable expenses
Fixed expenses (housing, utilities, insurance) are hard to reduce in the short term. Variable ones (leisure, food, transport) are usually where there's more room to adjust if the budget doesn't add up. Seeing them separately helps decide where it's worth cutting back, instead of just looking at one overall number.
What to do with what's "left over"
That leftover money is exactly what you can put toward savings or investing. A common reference (not a fixed rule) is to try to save at least 10-20% of net income, if your situation allows it.
Once you know how much you can realistically save each month, try that figure in the compound interest calculator to see what it could grow into over time.