Friday, October 10, 2008

Dollars and Sense 2 -- Needs vs. Wants

Okay, everyone! I'm going to be continuing our "Dollars and Sense" series today (read yest. post to catch up if needed!) by talking about Needs vs. Wants. Did you take a look at your monthly finances yesterday? Are you bringing home more $ than you spend?? Could some things be trimmed from the list? Could we just stand to be better stewards of our $$? Let's take a look:

Needs: what you absolutely must have! Housing, food, major utilities, adequate clothing, transportation, medical care options, insurance (medical, house, renters, car, life, etc.).

Wants: things you might really really desire, but are not necessary! Things like: getting your nails done, eating out, coffees, video games, tanning beds (hopefully for the cancer risk you aren't doing this anyway!), extra home accessories, etc.

Okay, got the basics? Pretty easy, right? Here's where the hard part comes...You have to adjust your way of thinking! You MUST if you want to save $$!!! Every time you go to purchase something, you must think: is this a NEED or a WANT.

Do not fall into the trap of thinking "Well, it's on sale"....or...."I deserve to get xyz because I've been doing well"...! This only sucks away your $$! It's a lie we tell ourselves to justify our spending. Think only : "Need or Want?"

WANTS can be added to a gift list for Christmas or birthday possibilities (with the knowledge by the family that not every item on the list will be given), or WANTS can be purchased with extra money available only after all of the monthly NEEDS have been paid, and some is placed into savings.

NEEDS may be purchased if they fall into your budgeted amount for the item (say, $40 for a new coat for your child) and after doing some comparison shopping for the best price! Also, for NEEDS such as this (a coat) you must make sure that all of your regular monthly bills--the most important NEEDS-- are paid for first...otherwise that coat may have to keep kiddo warm because the gas heat has been turned off for late payment! ( Late payments on your mortgage or utilities being shut off also get reported to the Credit agencies, and your chances for future loans/good rates are very much affected by this! Please pay on time!)

Where can we trim our monthly expenses? Ask what is really necessary, and what is fun but not a NEED right now.

Could you do without eating out so often to save some big bucks? Could you do without cable? Paint your own fingernails at home? Start to cut your families hair yourself? How about choosing healthy, needed foods at the grocery, and do without buying pop or chips or many expensive, packaged foods! Call the credit card companies and ask for a lower interest rate? Have friends over instead of spending money going out? Ask your families to add things they desire onto a gift list (knowing they might not get it all!) instead of buying the latest video game or sweater or book right now?! You can do it!!

I feel so strongly about this, about being personally responsible for our financial choices, dear readers, that I ache! I could get on a serious soap-box. I could be Drill Sargeant Stacey and give you true stories of irresponsibility and how it has ruined families. I could cry because I know that some of you want to cut back on spending, and some of you are truly truly struggling financially. But all I can really do is pray for you all, dear readers, and try to give some basic guidance. The rest is up to YOU!! Ultimately, YOU YOU YOU are the ones responsible for being caretakers of your family's finances. YOU must make the daily choice to stay on task. To do your best to stretch those dollars. To be responsible. This road may not be fun, and it won't be easy for all...some of those dollars are going to have to really stretch far...but it can be walked down successfully! I really believe that you can do it!!!

Yesterday and today's posts are just the basic foundation for the rest of our series! What you'll have to keep in mind for everything else! :)

Take a look at your monthly expenses.

Ask what is a NEED and what is a WANT. Find ways to trim the budget accordingly.

We'll go into more ways to do this starting tomm., when we'll do ways to save at the GROCERY!

ps--my friend Angie at Sandals and Daisies made a great list yesterday of ways to save money! Go check it out!!


Darlene - Our Creative Life said...

Here's a tip: If you decide to go out to eat, choose a restaurant that you know gives big portions and split it. Hubby and I do that alot and cut our going out to dinner bill in half. We get plenty of food & we don't help expand our waistlines by the ever increasing HUGE portions that they serve! Also order water, soda is so bad for you and it's expensive!

Sarah Mae said...

Ha! Before I came to this post I just posted about starting a series on Saving/Budgeting! I may have to reconsider, seeing as you're doing a great job! :)

Imperfect said...

I can't wait for tomorrow. I love saving at the grocery store. Planning my trip around coupons and sales is so fun and such a game to me! Hubby and I have really been working on defining our needs vs. our wants. It's amazing what you can live without when you choose to.

Stacey said...

Yesterday I spent too much money to have our dog bathed and shaved. I am thinking about buying a razor and shaving her myself!

I am excited to hear about grocery tips. I got really pumped awhile back to become on of those shoppers who manages to get all of the groceries for very little. However, my grocery stores do not double coupons and we don't have many stores to choose from. It just doesn't seem to work out. It's still fun to save $20 or $25 with coupons.

Stacey @ The Blessed Nest said...

I'm so glad you guys are excited about this series!! Yes, defining Needs vs. Wants is one of the best ways to start saving $$!

Darlene--Great tips on saving $$ at restaurants! :)


Libby said...

Amen sister! I could get on my soap box too, believe me. When we had our little boy, I decided to stay at home. Since we are right out of college, things can be tight. BUT we have scrimped a lot. We never have paid for cable and go out to eat maybe once a month. I make our own bread and rarely buy convenience or junk food. I wear clothes from high school and even junior high. It is amazing how the money can add up if you don't really understand budgeting. I'm glad a lot of bloggers are sharing our money saving tips. We can all learn something, even if we have been saving a long time!

Jen - Balancing beauty and bedlam said...

My friend - scoot on over and I'll join you on that soapbox!! What a great post...I am glad that you are speaking so is a huge issue, and it's really a entitlement mentality. People feel that they are entitled to Wants...UGH!

Stacey said...

Hi Stacey:
Just had a chance to catch up on this week's posts. Thanks for doing a great series on saving money... Definitely a good topic for this season of financial "instability".

kristi_temple said...

I wish I still fit into my junior high clothes. I am noticing that some of those clothes are back in style. We only go out to eat if we have a coupon or on "kids eat free or for 99 cents night". I have 3 boys so I save all their clothes and I buy anything they need from goodwill and consignment shops. I shop for my husband's work clothes there too. It is only $3.50 per piece for adult clothes and you can sometimes find great deals like Ralph Lauren pants with the original store tags still attached.

Sandy said...

Great post with practical advice!
I'm def. looking at ways to cut costs. I'm tired of my food bill going higher and higher!