I am pretty sure that as a human being you also have your own set of needs and wants. But with a budget, you may not always get what you want. In the end, you will prioritize your needs because they are more important. Therefore, it is very important that you know how to categorize your needs from your wants. Another challenge here is that the needs and wants of a person differ from each other. In this case, you may miscategorize your wants as needs since you are already used to them that you started to rely on them so much.
Then you lose your budget and you start having financial problems. If you happen to have trouble budgeting your income, don’t hesitate to use financial software from IRESS because they have the most reliable software for your financial needs.
What are the common wants and needs of a person?
If you categorize your wants and needs in a budgeting worksheet, you have to separate the expenses into the things that are considered to be absolutely necessary (needs) from the things that you want to have but are not required for survival (wants).
Needs are described as your ‘basic living expenses. These things are important for your health or the expenses that you need for you to properly do your job. These things are;
- Utility bills
- Work uniform
For your wants, these are the things that you don’t necessarily need and you can live without;
- New clothing
- Dining out
- TV/Music streaming account
- Home purchases
- Monthly subscriptions/membership
Wants are actually not bad at all. They give you happiness after a days’ work. There are times that these wants push you to accomplish your goals, help you have fun, and keep a healthy body. But these things are not necessarily needed for your survival and your overall survival.
Needs But Are Actually Wants
Sometimes, it is difficult to distinguish your wants from your needs. The line that separates these two is becoming so blurry. To resolve this issue, you need to be true to yourself and know if you really ‘need’ the thing or you just want it around. These are the things that you need to believe that you need but they are actually one of your wants.
Oftentimes, the expense that you spend is classified as need or want according to how you utilize it. For instance, home internet belongs to your needs if you are working from home. But, if you use your internet just to browse or play games, this belongs to the things that you want.
There are different categories of expenses, it is split into your wants or your needs. A grocery bill is categorized as need because you need to eat to live. However, if you include chips and soda in your grocery shopping of basic necessities like produce, whole grain, and protein, then you are mixing your needs from your wants.
Your house budget plays a very important role in your financial stability. When you lose your home budget, you start to rely on loans and debts. For you to become debt-free all the time, you need financial software from IRESS to help you manage your budget efficiently.