Sunday, 11 June 2017

Needs and Wants

   








You may have done the exercise of considering potential expenditures as falling into the category of either a need or a want.   You probably think of a need as a legitimate use of your funds as in you need to eat to survive or you need to drive to your job as you'll be fired if you stop showing up.  At first glance this appears to be supremely useful but it can have the effect of truncating the analysis.

You might make a list:

Need to pay                                    Want to buy
                                          
Housing                                          a dog
Food                                               new shoes
Car                                                 dinner at new restaurant
Telephone                                      Travel
Credit card interest                        music lessons


You'll notice that the items on the left, the Need category are the ones you might see on a typical pre-printed budget that you fill out.   They tend to be big ticket items or the larger line items in your budget.   But since you need them, and need to spend the money they cost, you focus instead on limiting or eliminating the wants.    Now some of those wants may be frivolous, unnecessary and short-lived pleasures.  But some of them may add life long meaning to your life and memories that you will remember on your death bed.  I appreciate that my immigrant parents paid for piano lessons for years enabling me to have a talent and pleasure I enjoy today.   Many people consider their pet to be a member of their family that they would not do without.

Maybe a tiny house is too extreme for you

If you cut your housing expenses by two thirds you will be able to still have something you need, ie. a roof over your head and at least several of your wants.   Impossible you say.  Not really, you just need to think outside the box.   Families today live in houses three times the size of a couple of generations ago.   1200 square feet comprising 3 bedrooms and one bathroom used to work just fine but today 3600 + is more common with 5 bathrooms and 4 bathrooms the norm.   Somehow it became a rule that each child should have their own bedroom.   I think that idea has its root in advertising and marketing.   When in doubt about the origins of something that has become accepted, follow the money!   Who is benefitting from enormous over-the-top weddings?   Separate rooms for 60 shoe wardrobes?

Is it you?



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