Priorities: Need vs Want

This is an introduction topic to budgeting. We always need to have goals in life to know where we are going so eventually we can get there. In financial situations our goals are our priorities. We have the opportunity to establish what we want our money to do for us and then budgeting is the planning to make that happen. With priorities it is also helpful to distinguish what we need and what we want.

Need is a word that to me is about survival day to day being able to wake up in the morning and live until I go to sleep at night. Under this heading we can see that we don't need as much as we might think. To be alive from day to day we definitely need food and water I will give you that. Also other basic needs would be shelter and clothing to protect us from the elements. Do we need electricity or other utilities? I would say that they help a lot with life especially electricity for refrigeration and gas or electricity for cooking, so I will accept basic utilities as a need as well, but they aren't absolutes. Basic utilities would be electricity, natural gas, water, and I would say telephone access of some sort. Telephone would be a need in emergencies more than anything and could be simply assuring that you had access to a telephone in an emergency.

Another set of needs that does not exactly equate survival, but is necessary nonetheless would include such things such as savings. I also believe in charitable actions as being part of this category. In my religion we believe the first priority is our allegiance to God and in my life this has a Need priority. I believe that God wants me to dedicate part of my income to his work so I do that first.

Want is a word that covers the rest of those things we might buy with our money. If I like to watch movies I might want to buy some and start a collection or I might like tv and decide I want cable or satellite service. These are things that might be fun and enjoyable but that I could live without if I needed to. With future posts I will discuss other wants that we might not notice that can help us with budgeting.

With the ideas of need vs want on the table we can prioritize our expenses to make the most of our money. We begin with needs, for my family this would be Tithing (church donation), food/shelter, utilities, and savings contribution. We can then think of how to best prioritize those things that we want or decide to forgo some of our wants to add to those things we need by increasing savings in the form of food storage or monetary savings.