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Wants vs. Needs – Priorities for Debt Control

Wants vs. NeedsOne of the most discouraging parts of modern life is the never-ending desire for more. We have so much that we turn around and sell our stuff at a fraction of its purchase price only to go shopping for more – an insane circle of insanity. On top of that, we not only buy too much, but we often go into debt doing so. Knowing the difference between what you want and what you need in life is the first step in getting your spending under control. The concept is pretty simple, but it will require an in-depth self-examination before it can be truly effective.

What You Really “Need”
We have five basic needs: oxygen, shelter, food & water, health care, clothing – necessities to maintain life no matter what culture or climate.  Anything that goes beyond the simple basics of these five needs is a want, including designer clothing, a big home, fancy cuisine, expensive wine, or a luxury automobile.

Something is probably a “want” if it is possible to delay the purchase, substitute something less expensive or make do with something you already own. For example, you may need a new car, but do you need all the bells and whistles of a luxury sedan? Once you can be honest about the things that are truly needs, you will need to commit to a plan and use self-control to put solutions in place that will help reduce your debt.

Living With Just the Basics
Although it’s the simple things that should determine our happiness, many people find it difficult to live strictly with the basics. Basic needs can be met, as in many impoverished areas of the world, by a small self-sustaining farm, rainwater and a pair of pants, shoes and a coat or blanket. But for many Americans, our hopes and dreams are “wants”, especially since we have access to so many luxuries that are unknown in most parts of the world. When you cannot distinguish between wants vs. needs, or if you can’t identify a want as a want, you set yourself up to live in a constant state of craving and disappointment.

The following chart shows statistics from 2006 of luxuries vs. necessities over a 10 year period. The question asked of the survey participants: Do you think of this as a necessity or as a luxury you could do without?

Source: 2006 survey by Pew Research Center

Healthy decisions are more about priorities. What if financial happiness is not about getting more but about wanting less? Life is meant to be lived, dreams are meant to be pursued. The key to enjoying more than the basics is to treat yourself to your wants only when you can afford them.

* Do you have problems with debt? Consider debt settlement.

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