Wants Versus Needs: 3 Ways to Tell the Difference When You’re Saving Money

Figuring out what you want to spend your money on versus what you really need can be tricky. With constant advertisements and sales pitches, it’s easy to blur the lines between genuine necessities and discretionary purchases. 

Still, it can be done and here are 3 helpful tips.

Assess Immediate Usefulness

Understanding the immediate usefulness of what you’re considering buying means figuring out if it’s essential for your day-to-day life or if it’s just something that adds convenience or pleasure.

Needs are the essentials you want to have for daily living, like groceries, housing, and healthcare. They’re the basics that keep you healthy and secure. Wants are the things that make life more enjoyable but aren’t crucial. Think of them as extras that you don’t really need for your daily functioning.

For example, groceries are a need because they provide the food you need to cook at home, which supports your nutrition and health. Dining out at a restaurant is a want; it’s enjoyable and convenient but not necessary for your survival. 

Evaluate Long-term Impact

Evaluating long-term impact means making sure you get how a purchase will affect your future so that your spending supports your future goals and financial stability.

Here, needs are investments that really matter for your future, like paying for education, essential health treatments, or important home repairs. On the other hand, if it’s just a temporary fix or brings short-term satisfaction without real future benefits, it’s likely a want.

Consider getting osteopathic treatment for chronic back pain versus buying a massage chair. The treatment is a need because it addresses a serious health issue and can definitely improve your quality of life over time. On the other hand, while a massage chair is relaxing and enjoyable, it doesn’t really tackle the underlying problem.

Consider Emotional Triggers

Emotional triggers often lead you to buy things impulsively, which can throw off your budget. Recognizing these triggers means you can make more rational purchasing decisions.

You want to base your purchases on what’s truly necessary rather than on emotional impulses. Be aware of marketing tactics and peer pressure that might push you toward buying things you don’t actually need. 

For example, think about buying a new coat because your old one is worn out and you really need it for the winter. This is a need because it’s practical and addresses a genuine requirement. On the flip side, purchasing a trendy designer jacket just because it’s on sale and everyone else seems to have one is driven by emotional triggers. It might feel satisfying in the short term, but it doesn’t fulfill a critical need.

So, next time you’re about to make a purchase, remember these tips! Chances are you end up spending wisely and saving effectively.