There are things in your life that are must-haves. For me, these consist of shoes, clothes, and new technology. What are yours? I’m sure you have a list just as material as mine, but prioritizing wants over needs disturbs the balance we expect our hard-earned money to provide!
There is a difference between needs and wants, and we often internally struggle with the decision. It’s a mental battle all of us fight every day. Should I cook at home or take the family out to eat every night? Do I need this watch now, or can I wait for it to go on sale?
It’s easy to say you want to save and build wealth, but how will you get there? When it comes down to discerning a need from a want, I ask myself a few simple questions:
- How long will I need this?
- How often would I use this?
- Can I actually afford this?
- Can I wait?
“I need this because I want this” can be convincing, but throw a red flag on the field anytime these two words are in the same sentence. You are entitled to spoil yourself within reason if you’re budgeting and saving like you should. Life is short, so why not? Well I am here to tell you there are plenty reasons why. Wanting something isn’t a bad thing, it’s about strategically planning for it. Here are three questions to ask yourself to make sure you’re prepared for a purchase:
- How will I feel a week from now?
- Will this put me in a bind or hinder my saving efforts?
- Am I just trying to keep up with the Joneses?
Too often, it’s number three, caused by the social burdens of our modern world. Many haven’t realized others’ impact on their financial situations. Let’s say you bought a new car—a nice Mercedes with all the bells and whistles. If for one second you reevaluate your vehicle purchase, you probably didn’t make the best decision. That hesitation and gut feeling will be right more often than not. I can go on and on, but the point is to simply live within your means. Grasping that concept will save you, add value to your bank account, and prepare you for the next levels of wealth.
Prioritize your bills, pay off your debt, and stick to a monthly budget! Schedule a consultation with my wife to create a financial plan to satisfy your needs, wants, and even help you buy that new Mercedes.
Author: Quincy Humphrey