Distinguishing Between Wants and Needs
Learn the Difference to Live a Happy, Fulfilled, and Frugal Life
The trick to investing, saving money, and reaching your financial goals is to make sure you’re wisely balancing your long-term needs and your short-term wants to allow you live well, but frugally, and find joy and contentment in life. There is no formula for that as only you can determine which trade-offs you are willing to make
The difference between a need and a want is pretty simple—until you set yourself loose in a store.
Double chocolate chip ice cream? It's a food, so mark it as a need. That designer T-shirt that fits you perfectly? Well, you need more shirts, so why shouldn’t it count as a need, too. It's easy to mix up wants and needs, break your budget, and lose sight of your goal to live frugally. Read on to learn how to easily distinguish between the two and avoid falling into this financial trap.
The difference between wants and needs is quite simple, at least on the surface:
- Need: something you have to have
- Want: something you would like to have
Tally up the damage caused by a few justifications like those mentioned previously, and suddenly you've spent far more than you intended. What's the solution? Start with an understanding of what a need really is and when something is a want.
Understanding Needs vs. Wants
In actuality, you only need four things to survive:
- A roof over your head
- Enough food and water to maintain your health
- Basic health care and hygiene products
- Clothing (just what you need to remain comfortable and appropriately dressed)
Everything that goes beyond this—a big house, name-brand clothes, fancy foods and drinks, and a new car—is a want.
Does that mean that you should only buy the things that you need? Not at all.
Life is meant to be lived, not survived. Treat yourself to some wants along the way, but do so when you can afford to, and enjoy those wants as the extras that they are.
Appreciate What You Have
Once you become better at differentiating between wants and needs, you'll probably see that you've been able to fulfill more of your wants over the years than you realized. And that can be a major turning point. When you find things that you want to buy or do that you currently can't afford, it becomes all too easy to focus on those things to the point of overlooking all the many possessions that you do have. Don't trick yourself into feeling deprived when you aren't.
Take time to reflect on all the ways that you've been blessed. Then, decide what's really important to you, and go after it. So many people talk about wanting to do this or that, but they never actually try to make it happen. Be the person who makes it happen.
Create a Budget Plan
Come up with a plan, and act on it. Even if it takes you a really long time, just working toward a goal is empowering. It makes you feel capable, instead of deprived; it makes it easier to tune out all those things you don't need , and it puts you in charge of your where you'll go next.
Use a financial goals worksheet to note your goals on paper. Then, learn how to fit your big dreams into a small budget.
Photo: Mark Wheadon
"But Mo-om, I want it!" How many times have you heard that in the grocery store, or the toy store, or anywhere else, for that matter? Probably more than you can count. And what do you think when you hear it? That poor parent? Or, thank God that's not me anymore! Or, What is wrong with that child? Most of us go on our way, relieved for some reason. It's not our kid, it's not us, and we don't have to deal with it.
Or don't we? The truth is that, as adults, there are times when we keep ourselves from throwing these sorts of tantrums by buying something we don't need. We see an item, feel the same desperate need that child felt, and assuage our own feelings by buying the item. We have the power to do that for ourselves as adults. But these are the purchase we often feel guilty about, and one of the main ways to get rid of the guilt is to find a way to classify that purchase as something we do need. Actually, we can do this any time we regret a purchase. (See also: 9 Simple Ways to Stop Imipulse Buying)
So it's time for all of us (and I include myself in this) to grow up, time to stop looking like adults on the outside but acting like chidren on the inside. To do this, we must learn to distinguish between what we need, what we need in certain conditions, and what we want.
These are the obvious things that every person needs to stay alive. I include food, water, shelter, and not much else in this category. These are the things without which we would not be alive. You'll notice that I don't include a certain kind of food or shelter here. If you're in a truly desperate situation, spending what money you have on the best food, water, and shelter that you can makes the most sense. If you're in less desperate circumstances, it's up to you to determine what sort of these things would be best for you, on your budget, etc.
Slightly Less Necessary Needs
We each have our own circumstances that dictate some other needs. For instance, in order to keep my job, I need reliable transportation. Since public transport is wretched where I live, that means I need to have a vehicle. Since I don't have a motorcycle license, it means I need to have a car. It doesn't have to be the nicest car, or in the best repair, but it does need to work consistently. I also need a few items of a certain type of clothing, because if I don't dress a particular way, I will lose my job. These aren't basic needs, but they are things that I need in order to be a responsible adult in my life as it currently is. Stay-at-home parents will have these sorts of needs, but theirs will be different than mine. It requires a certain level of maturity to determine what these needs are, but this develops over time and as we put in the effort. (See also: 5 Ways to Snag Budget-Friendly Business Clothes)
Everything else is a want. Read that again. Everything (every single, little, tiny thing) is a want. They're not needs. Now, there are levels of wants. Some are much nearer to needs than others. For instance, I want a new computer. I could tell you that I need it to do my writing, but that would be a lie. I have a computer that's not dead yet. And if it dies, there are other computers I can use with enough ease that a new machine is not necessary for me to do my job. But a new computer would help. For instance, it would be faster, which would mean that I could do more work in less time. It would also have a must lower chance of crashing, which would mean that my work would be safer, which would also help me immensely. So there are aspects of a new computer that would aid me in legitimate ways. So a computer might be closer to a need for me than, say, that library of GK Chesterton's work that I've been eyeing, or the several new pairs of boots that I know I would enjoy.
It's hard to transition into thinking this way. I know; I've been working on it for months know. It requires us to be ruthless with ourselves, to tell ourselves the truth, no matter how much we don't want to hear it. It requires us to say NO! when we really want to say YES!, and it requires us to value skills that some people don't develop over an entire lifetime. However, in a world where we're constantly bombarded by advertisement, by people telling us what we do and do not need, this ruthlessness is essential to our financial survival. We must constantly evaluate what we see, hear, and even what we think, because only then will we have money to save and complete honesty with ourselves.
Like this article? Pin it!
Tagged: General Tips, I need it, I want it, need vs. want
Disclaimer: The links and mentions on this site may be affiliate links. But they do not affect the actual opinions and recommendations of the authors.
Wise Bread is a participant in the Amazon Services LLC Associates Program, an affiliate advertising program designed to provide a means for sites to earn advertising fees by advertising and linking to amazon.com.