LIFESTYLE & TRAVELBUDGETINGCOLLEGE

Know Your Needs

As you go through the motions of life, you’ll likely hit a point where you realize you need to establish a budget. You may not know how to start or how to navigate your expenses. Creating a budget is quite simple in theory and can be done by anyone. Before you begin listing off what needs to be changed or eliminated from your spending you need to understand what your specific needs and wants are.

When you think about needs versus wants, what comes to mind? A need is defined as something that you can’t be OK without having or obtaining. Needs are things you must have to survive or maintain a healthy well-being. Needs can include things like medication, books for class and access to the internet. A want is something that’s nice to have but not absolutely necessary. A few examples can include streaming services, luxury vehicles, designer furniture and even high-end fashion. You may like these items, but do you really need them to live?

Sometimes the process of determining your needs and wants becomes a reality check for those who are used to expensive things but can no longer afford to be a consumer of those high-end items. If your income is changing to a lower amount, it may be time to adjust what you can afford. This doesn’t mean you can’t have the things you want, but it may require a shift in how you spend your money. For example, you may love getting your coffee at Starbucks every morning before work, but now you might have to transition to making your coffee at home four out of five days a week. That way, you still get your morning cup of joe but you’re not overspending for the brand. Starting habits — such as asking yourself if you need something — is a great way to hold yourself accountable.

Analyzing and making changes to your needs and wants can be easy in some cases and challenging for others. Having a goal in mind can help make spending adjustments easier. Making decisions that support your overall goal will help you stay on track to creating a fulfilling lifestyle within your means.

Sources:

https://www.thebalancemoney.com/how-to-separate-wants-and-needs-453592

https://www.berkeleywellbeing.com/needs.html