One of the biggest issues when it comes to budgeting is the truth. The truth about what we need and don’t need. Now, before you go rolling your eyes at that, I’m not saying that you can never purchase a $5 latte or go on a shopping spree. I’m just saying that you need to be completely honest with yourself on your spending. 

Many times we’ll tell ourselves that our kids need new lunch boxes for school because it’s a new school year, when in fact they don’t really need a new one – the old one just needs a good wash through the dishwasher. We’ll tell ourselves that we need to have cable because it’s the only way to watch sports. 

We’ll tell ourselves that we need a new phone because our old one is now super slow; when all it really needs some decluttering of the stuff we have stored on it. 

The truth is that there is a ton of stuff that we can live without – the question is really do we want to?

It’s totally okay to say, “no, I don’t want to live without cable TV”, but we have to be willing to say that “no, cable TV is not a need – it’s a want”. We have to be willing to redefine how we see our “needs” and our “wants”. 

Society will tell us that we need to have the perfect house in order to properly entertain guests.

Society will tell us that we need to have the latest and safest baby products before we can bring our new baby home.

Society will tell us that we need to have all the updated technology in order to run our businesses effectively. 

Society will tell us that we need to have our children involved in extracurricular activities in order for them to be accepted to a decent college. 

Society will tell us a ton of things that we need and they do it so beautifully.

They truly make it sound like all our problems will be solved once we have this or that in our lives. 

But the ONLY way to solve our money problems is by fully understanding what is a need and what is a want. Like I said, it’s okay to still buy a want – so long as you understand that it is a want and not a need. 

How to define a need vs. a want.

A need is simply what you must have to survive. So your house (including your utilities), groceries (not dining out), transportation to and from work, and basic clothing. Now, you might need to add “medications” to the list of needs if someone in your household requires regular medical care, but for the most part these are the essential needs of most households. 

Wants are everything else and this is where the lines start to get fuzzy for most folks, because well, on our list of needs is “transportation to and from work”. Many folks see this as they must have “reliable transportation to and from work”, which yes, you should have reliable and safe transportation but that doesn’t mean you have to have a $30,000 or even a $15,000 car. It simply means you have to have a car that runs, has seat belts and brakes when you need to stop. 

It doesn’t mean your car has to look nice. It also doesn’t mean that you have to have a car at all – many folks do just fine with public transportation or riding a bike, but granted that only works if you live close to a large city or close(ish) to work. 

It’s the same for your house.

Your house doesn’t have to cost you a fortune and it doesn’t have to come out of Better Homes and Gardens to be something that your friends and family want to come to. It just has be a home – you know, a comfortable place filled with laughter and love. So don’t spend a fortune trying to mimic the talented Joanna Gaines. 

But, once again, it’s okay to decorate your home like those found on Fixer Upper – so long as you have the room in your budget and you understand that it is not a need but a want. 

What are your priority expenses?

This is why I think it’s important to establish what I call “priority expenses”. These are expenses that are “must include” in your budget every month. 

So think about what are some expenses that are a priority for you and your family? Is it saving money into an emergency fund? Giving money to charity? Your basic survival needs? Spend a little bit of time determining what your priority expenses are – this list doesn’t have to be long and in fact, it probably shouldn’t be too long.

Here’s an example of our priority expenses that are “must include” in our budget every month:

• Saving money to our Emergency Fund
• Rent and utilities
• Food (groceries, not dining out)
• Charitable giving

Make a list of these expenses and keep the list where you create your budget every month. This way you’ll be reminded of what you must include in your budget before you account for any of your wants. 

What advice can you give someone struggling to come to terms with their needs vs. wants?

The post Do you really want to live without it? appeared first on Jessi Fearon.