Wants vs. Needs

Common Source of Financial Problems

Wants vs. Needs

In school, one of the basic concepts of economics that we learn about is the difference between a want versus a need. But what are they exactly? A need is simply something you have to have, or something you cannot do without. A good example of a need is food, everyone needs food and if you don’t provide that for yourself, you will not survive for long. Many people try to go days without eating food, but then end up binging and eating a lot of food. It is not necessary that you eat a lot of food, but it is necessary that you at least do eat making food a need.

Comparatively, a want is something you would like to have and is not completely necessary. It would be a nice thing to have, and would make you happy but it is not imperative. An example of something you want would be music. Some people would argue that music is in fact a need if they are extremely passionate about music, and may say that they cannot live without it. But in order to survive, you don’t need music but you do need food.

Nowadays, many of us are living beyond our means. Having seen someone else owning a certain item, or doing something we would like to do, naturally as humans we are inclined to want or want to do the same thing. We have to be cautious in this situation, as we all know we have to work hard for our wants and needs, but the big but is to not spend beyond our means. There are many outlets in the world such as us at AAR Financial, where we will provide you a loan and credits (which we love to do!) but you must be smart in managing those credits. It is important to watch our spending and allocate our budget on what we need and what we want and not go overboard with our extensive wants list.

Below we have found a website that will provide you with 10 downloadable worksheets that can offer some help with preparing your own personalized financial plan. You can download them and print them off, or fill them in on your computer to help you keep track of your finances!

To help you get back on track, give us a call or send us a message for more information. At AAR Financial, we are here to lend a helping hand.