First, it is important to understand that needs and wants aren’t the same. As we read that sentence, we say to ourselves…everyone knows that! Again, while we might know this intellectually, there is a good chance that we’re not completely sincere with ourselves with regards to the things we buy. When it comes to our spending habits, it’s important to get clear and spend some time to seriously consider taking a look at our current lifestyle and what our true needs are in contrast to those things which are convenient wants. Taking this step will go a substantial way in saving us money and allowing us to spend less than we earn. Not all needs and wants are completely black and white. What can be a want for one individual can be a need for another person. For example, if we earn our livelihood using a pc, then a pc is a requirement for us, but if we only use a pc to play the most recent on-line games, then it’s not.
This is Why You Should Re-evaluate Your Needs
As you take a close, hard and honest look at the things that you consider to be needs and wants, the choices and decisions may not, and in some cases, will not be easy. Those tough decisions will take having the right attitude, discipline and self-control. It’s going to take an adjustment of how you see things, a sort of paradigm shift. The things you thought were needs and are realized as wants, now have to be put off until you get yourself to the place where you can responsibly spend the money on purchasing those things. You have to remember that this is a temporary place to get yourself on the right track with your finances. As you give yourself some financial breathing room, you’ll be able to enjoy what was once a sacrifice.
By taking the necessary steps toward adjusting your spending habits now, with patience, over time, you will be able to attain the things you want without the constant stress and anxiety of how you’re going to take care of your needs. As the saying goes with regards to physical health, “an ounce of prevention is worth a pound of cure” can also go for your financial health. Making some sacrifices now in the short term will be worth the financial freedom you’ll gain later in the long term! The mental and emotional choices that you’ll have to make between your needs and your wants will be difficult at first, but the reward of bringing your financial health back to life will make it surprisingly easier as you continue on.
“Focus not on what you earn, focus on
how you spend what you earn.”
― Stephen Magnus
A fundamentally crucial part of the journey to financial well-being is the principal of spending less than you earn. And although there is no single road to financial well-being, that one principal is what sets you up to not only begin creating your wealth, but to also keep what wealth you attain along the way. The reality is that nothing else can happen without following this one principle. That principal holds true whether you make $10,000 per year or a million dollars per year! While the concept is straightforward, if you’re not following it, you just end up living paycheck to paycheck, just barely keeping your head above water. Not only will that keep you from ever creating wealth, but it’s at the very least no way to live. That kind of living only brings about stress, worry, anxiety, depression and other negative emotions.
The way to master the principal of spending less than you earn is that you need to understand and realize the distinction between your needs and wants. For a lot of people, the distinction isn’t always so obvious and when faced with the reality of sacrificing wants for needs, it can also be emotionally painful. With honest examination, you’ll find the things that you feel are needs are actually wants in disguise. Taking a closer look at these differences and how your money is being spent to accommodate them can be an eye-opening exercise in discovering where money can actually be saved. Having money left over at the end of the week is the only way to improve your financial health and it starts with getting hold of your spending habits.
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