Do We Really Need That?
My wife and I were recently talking about how we need to get a new TV in our bedroom. With the digital switchover happening in 2009, we have two options to consider. First we could buy a digital to analog converter box for about $10 after using our $40 government coupon. Second, we could buy a new digital TV for $400-500. After considering it we both decided we wanted that new TV, after all, we’ve earned it right?
We considered the expense over the next few weeks. We asked ourselves, “Do we really NEED to buy a new TV for our bedroom? Or do we just want to buy it out of a sense of entitlement?”.
We ended up not buying the new TV, and instead bought the $10 converter box. The TV works like new, and we saved ourselves a ton of money.
Entitlement blurs the line between wants and needs
The whole experience got me thinking about the sense of entitlement people have in this country today. They want to be able to have everything their parents had, but at a younger age. They want the house, but without saving for a big down payment. They want the fancy car, and they sign up for a 5 year loan at 9% interest. They want the new TV, so they put it on the credit card.
In an article on bankrate.com psychotherapist Olivia Mellan talks about how people confuse needs with wants:
A lot of us in wealthy, overspending America are either born or raised with a tremendous sense of entitlement. We say to ourselves,”I work hard or, I work at a job I hate — at least I should be able to have a Starbucks coffee every day or eat out for lunch.” But of course, those are not needs, they’re wants. They’re pleasures.
Wants and pleasures turn into needs because we feel like we deserve it – even if sometimes we don’t deserve it or can’t afford it.
Having a standard of living beyond our income is almost expected these days. Spending has gone beyond the actual needs of food, water, shelter and clothing, and have expanded to include things like a cell phone, cable tv, bottled water, eating out every day and new furniture. The things people enjoy having become needs in their mind, and without them they don’t feel like they’re living to the fullest.
The better off we become financially, the more we realize that true happiness can never come from the things we own. Instead they come from faith, family, friends and through helping others. All other sources of happiness are fleeting at best, and corrupting at worst.
Are you aware of your wants and needs – and how the line has become blurred in your own life? My challenge to you is to keep close track of what you’re spending this month, and see just how much of your spending is on things you want, but don’t NEED.
Avoiding impulse spending on things we want
So how do you avoid impulse spending when you’re trying to save or pay down debt? Here are some ideas that I came up with, along with a few from MSN Smart Spending:
- Implement a “touching and talking rule”: Either touch the item 3 times, or talk about it 3 times with a spouse or loved one before actually purchasing it. If you still can justify the expense after that, consider purchasing it if it will fit in your budget.
- Wait it out: Wait a while before making a big purchase. Give yourself some time to mull over the decision before dishing out the big bucks. At our house we try to wait at least a month before buying something, and if we still consider it a good purchase, we’ll go ahead with it.
- Don’t Buy it, Try it: Try borrowing the same or a similar item from a friend. Try it out and see if it is all you thought it would be. Chances are you may realize that you don’t need that Ipod as much as you thought you did.
- Save up and pay cash: Save for the item you want and pay cash for it. By the time you have enough money you may realize you don’t want it anymore.
- Ask yourself if you really need it: Ask yourself, “Do I really need this? If I get it, will my life be significantly improved? If I don’t get it, will my life be substantially diminished?”
When you think consciously about your purchasing decisions, and actually ask yourself if you NEED the things you buy, you’ll be well on your way towards living a less cluttered and more fulfilling life. You might even be able to save some money in the process!
Have you found yourself rationalizing your purchases by telling yourself that you “need” it? Tell us about it in the comments.
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Completely agree. I have a sense of entitlement that I became accustomed to because of how I grew up. I need to periodically do some self-analysis of my motivation when it comes to money. Am I buying this because of marketing pressures and I think I’ll look cool, or is it really going to provide value for me and my family?
Thanks for the good article.
I sure wish I would have read this before I went shopping at WalMart today! Ugh, I really blew it with impulse buys and just buying lots of groceries when I didn’t really need so much. I got the stimulus payment for the children, which I wasn’t sure we were getting, so I got happy spending. Now I’m not so happy. -sigh- You are so right with your post…we really have to think about our wants and needs. And hopefully, we’ll learn from our mistakes…
Nice article.
Here in the Philippines, with the inflation rate as high as 14% now, some people still buy stuffs based on their wants. Most do it because they don’t want to feel the worstening economy (e.g enjoy life now) but in the end, they end up with empty pockets.
Sams last blog post..Things to Think About When Buying Timeshares
Good inspirational post! I agree with the points you make about waiting it out. If you can avoid the first impulse, most of the time you realize that the purchase is not a necessity and you can live without it.
passivefamilyincomes last blog post..Financial Benefits of a DVR
I want a Corvette (or a BMW), but I know I don’t need one. Instead, I’m saving and investing because y wife and I plan on having children in the future. It’s probably better we don’t have a ‘Vette!
Patricks last blog post..The Remarkable Approach To Your Finances
Ew, Rolls Royce. Certainly not my favorite car in the world, I think I’ve maybe seen one in my life so far? (I’ve seen more Bentleys, for sure. I like Bentley’s styling more anyways…) Either way, those aren’t for me. I like ‘em small and fast.
I can say this, though: Do I need a Ferrari? Nope! But I sure do want one. Not just to have it, though. I want the freedom to have the entire experience whenever I want. (I’d be devastated having to return a Ferrari after renting it for a day.) No, objects can’t make me happy, but experiences can sure cheer me up. I’ve always found driving to be extremely pleasurable, so it’s more of an investment in my passions.
(I certainly have no desire for a home any larger than 1,000 square feet. I don’t want to go all out, I want to emphasize those few things in life that are near and dear to me, not “having it all.”)
That’s how I see it, anyhow. And, over time, Ferrari’s have the potential to regain value. Check out the prices of the F40’s and F50’s. Worth more now than when they were brand new!
Foxies last blog post..Is it Really Important?