Money. It dictates a person’s life. We love having money to spend with ourselves, friends, love ones. People are always aiming for more to make their life better and to fulfil desires.
The whole need and want meanings are explored by marketers constantly by switching their meanings to entice customers to spend. So, what’s the difference between need and want?
Needed:
Needed costs are self-explanatory, they are expenses that are essential for a living standard that is acceptable to your household. They fall within fixed and variable costs. Needed costs leave little wiggle room for adjustments in your budget.
Wanted:
Wanted costs fit under the discretionary cost category. It’s everything non-essential to your daily life. They are items usually responsible for your desires, to massage your ego and self-esteem. The holy grail of marketers.
Sometimes, there’s a thin line between the two concepts unperceived by a person. For instance, take your grocery list. You buy olive oil. A regular brand is $X, however, there is a fine extra virgin you love to use. It costs $XXX. The second one is the brand you want, the first the brand you need. At the end of shopping, these small indulgences can become a higher expense than you predict in your budget. Be aware. The same happens with clothing. You need a pair of jeans, not the expensive brand you want.
It’s in the wanted and discretionary costs where our decisions on a daily basis can make or break our budget plans. If you're budgeting towards goals and savings, it's in the discretionary and wanted categories where you'll find more money to save the easiest.
Of course, you are worthy. Sometimes, it is nice to treat yourself. You can definitely do it. An impulsive purchase will make you smile, as long as it doesn’t become a constant shopping spree.
You can budget your little indulgences— Reserve an amount to dine-out or drinks with friends, Maybe a movie night with popcorn. You have fun without hurt your budget and compromise your future.
Don’t let the impulse drive you away from your goals.
Challenge Yourself
The Need vs Want dilemma might become a wise exercise to your finances.
Every time you go to the mall if you need to buy something, make a list. Stick to it. Don’t buy anything more.
You’ll find out how much self-control over your “wants” you actually have.
Exercise the famous question: “Do I really need this?”
With time you’ll see it works just fine.
Controlling your urge to spend for the sake of spending will give you an opportunity to save and invest in your goals and dreams.
Be Smart about it!
KJ/DB