Prioritize Needs Versus Wants When It Comes to Budgeting

by Hank

We live in a society that seeks out and demands immediate gratification. We want it now. We want the best, and we do not want to make the sacrifices or the tough choices in life many times that is required to receive those things. We often do not want to make the hard choice that discriminates between wants and needs. We now think that everything is a need regardless of its true priority in our budget.

Priorities vs. Wants And Our Budget

It is important to prioritize and organize your budget to make sure that you have a disciplined way of saving and spending your money. You will definitely feel more at a disadvantage if you cannot pay for your basic necessities such as food, clothing, and shelter. I have written in the past about how to prioritize and choose which bills to pay if you are faced with tough financial decisions.

For example, many people have been forced into foreclosure because they sought houses that had more amenities or contained more space than they actually needed. If they had just chosen a home that met with their basic requirements as far as space and had avoided adding the extras that were not needed, such as that island in the kitchen for instance or swimming pool in the backyard, then they possibly could have avoided foreclosure and the stress and strain involved in finding another place to live.

Keep A Roof Over Your Head

Life’s lessons are sometimes hard to learn. Therefore, with respect to budgeting, pay your immediate needs first such as food, transportation to a job, clothing, and shelter. Extra income can then be allocated in your budget for the nonessentials items of life such as internet, cable, and even your credit card payment. Many people fall into the trap of paying credit cards before any other bills because collectors call at all hours of the day and night. People who owe money to them just want those nasty people to go away and stop calling. But, paying credit cards should be one of the last creditors on your list if you have a very tight budget. Do not choose credit cards over your house, rent, food, or the car that will get you to your job.

Saving For The Future Is Not Depriving Yourself

Many people believe they are suffering from unwarranted deprivation if they have to save their money for the future. We are very myopic and do not see the big picture of our retirement decades down the line. However, you really are depriving yourself more by not saving any of your income for retirement and other financial goals.

Make it a priority to take care of your basic needs first and then save for any future needs and amenities. Choose your priorities carefully over the luxuries and amenities in your life. Saving and investing money now is not depriving yourself. It is a practical way of making sure you never are deprived later in life.

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