Hello!
This month, we will cover Step 3 on the Path to Financial Balance...
Learn the difference between a need and a want.
In the last newsletter, we talked about the importance of debt reduction. It’s a simple equation: spend less and concentrate on paying down your debt. But how do you begin to spend less? By learning to fulfill your needs in other ways.
"We never have enough of what we don’t need." You’ve probably heard this bit of wisdom before. Think about it-- when we are deprived in some way everything feels like a need, when in reality we are just looking for a quick fix for whatever ails us at the moment. By learning to discern the difference between a need and a want, you will gain power over your spending…it will no longer control you. You’ll be able to decide where you want to spend your money each month and what steps you need to take to reach your financial goals.
 What is the difference between a need and a want? If you come from a place of deprivation, everything feels like a need. Or, if your parents provided everything you could possibly need or want you may not be able to distinguish between the two.
Here are some guidelines:
Need: Human beings have certain basic needs and we do not feel fully satisfied until they have been met.These are essential for our happiness; the “must haves” in order to survive: food, shelter, clothing. Add to those the intangibles such as love, companionship, fun and even the need for relaxation.
Want: A desire, a wish, the “like to have” but can live without. A home theater system, fancy car, another pair of black shoes, the latest electronic gadget. Now, I’m not saying that to achieve Financial Balance, you must go without these things. However, when we spend more money on our wants than on our needs, with the consequences of higher debt and little savings or investments for our future goals, our financial life can quickly spin out of control making life difficult and leading to greater unhappiness.
To distinguish between a want and a need when considering a purchase, ask yourself this question: “Is this getting me closer to my goal? Is this something I value or am I just satisfying a craving?” When was the last time you got a medical check up or saw a dentist? Are you properly insured? Is your car in good running order? Is it safe to drive? When was the last time you checked the tires? These are not terribly exciting things to look at or spend your money on, but they are essential to feeling that sense of security and achieving financial balance.
Now for those intangible things such as spending time with your family, sharing hugs with those you love, or reading a book by your favorite author. If you can feed your soul with these rather than another “thing” that you really don’t need, you’ll feel the urge to shop is lessened.
Once you look at the underlying causes of your overspending, and recognize the difference between a need and a want, your behavior will begin to change. So why not get started now. Here’s an easy exercise:
Make a 2-column list. In the first column, write down all your needs. In the second column, list as many wants as you can think of.. This will prepare you for next month’s newsletter which will be about saving money. We will look at how to save so that you can start to meet all your needs and some of your wants and wishes, and reach your financial goals at the same time!
Yours in Financial Balance,
Shelley Bayol
Financial Recovery Counselor
To read past issues of my newsletter visit my web site: findingfinancialbalance.com.
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