Establishing the Difference Between Wants and Needs

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Establishing the Difference Between Wants and Needs

Have you ever stopped to consider if you really need something before buying it? Or do you pick things up without a second thought as to how it will affect your bank account?

It’s important to establish the difference between wants and needs early on. It can help you overcome buyer’s remorse, free up money to be spent on actual needs (such as utilities and housing), and help you save.

Can You Live Without It?

A really simple way to determine if something is a want or a need is to just ask yourself if you can live without it. While those gourmet cupcakes seem like a delicious necessity in the moment, your world isn’t going to end if you don’t buy them.

On the other hand, we all have basic, necessary needs, such as shelter, clothing, food, and water. We need all of those things to survive.

Don’t get carried away, though. Just because something is at the grocery store doesn’t mean it’s a necessity. Cupcakes can count as food, but they’re not nourishing. They’re a “want,” not a “need.”

Likewise, if you already own 15 pairs of pants, you probably don’t need to buy more. You “need” a basic amount of clothing, but anything beyond that is an indulgence.

If you’re in a tight spot financially, focus on your immediate needs.

Question Everything — Don’t Assume It’s a Need

There are a few things that people say they need, that they really don’t. For example, none of us truly need cable television. While watching television brings us entertainment, it’s not necessarily to our survival.

Likewise, having an expensive mobile plan isn’t a need. There are cheaper alternatives that will give you the same result.

While it may sound extreme to focus only on what you need to survive, those that overspend could use the back to basics lesson here. We often confuse wants with needs because society has simply accepted things such as cable TV and smartphones to be needs.

Consider your purchases carefully for your own situation, not others.

Reap the Savings

If you are one of those people grabbing anything and everything off the shelf at the food market, start questioning your purchases. Chances are good that you’ll start saving.

If you go shopping without a list, consider what you need to buy beforehand. Once in the store, stick solely to that list. You’ll know your money is going toward only what is necessary.

Following the “challenge everything” method could save you even more. Completely cutting some expensive habits out of your budget is a good idea if you find yourself needing more cash flow. Spending on wants is unacceptable if you can’t even afford to pay your rent or mortgage every month.

No Regrets

Taking the time to question your purchases also means you’re less likely to end up regretting them. The more thought you put into it, the better off you’ll be. Try waiting a set amount of days before pulling the trigger on a purchase.

Here’s an effective exercise: If you want to buy something, pause and wait for 10 days. If you still want the item after 10 days, buy it. Most of the time, this simple exercise alone will cause you to skip over the majority of purchases that you otherwise would have made.



MARCH 23RD 2020

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