I can hear my mother saying it now "are they a NEED, or a WANT?". Pretty much every potential spending opportunity came with the immediate response, asking if it was a need, or a want.
Now, I'm not daft. I did ok at English at school. I know what those words "need" and "want" mean. So why, along with so many others, have I found it so difficult to distinguish between the two. I know that a need is a need, but for some reason, I also have the ability to interpret the word "want" as "absolutely got to have it or else I will die"!
The idea is quite simple. There are some things in life that we need - now, I'm not talking the basic fundamentals of survival. Food, shelter, clean water, clean air. I'm talking the ability to get to work, the ability to stay safe with appropriate equipment or clothing, basically the stuff we "need" to carry out our day to day life.
When a NEED comes up, we pretty much have to find it, fix it, fund it etc. An example would be: When the brakes need replacing on the car, there's a good chance you really NEED to get them repaired pretty darned quick.
The reasons might be twofold - 1) you need to get to work, because you rely on the salary you earn to pay the bills and the mortgage, and without the salary, you will fall behind on the basics. 2) you can't drive the car with defective brakes, because not only is it a safety issue for you, but it is a safety issue for any one else on the road, or the pavement nearby, should those brakes fail.
So....repairing the brakes are a need. I think we would all agree on that. You might be able to cadge a lift with a colleague for a couple of days, or arrange to work from home for a week or so, but if it's the wrong side of payday, or you don't have a slush fund to cover such unexpected costs, then you might resort to borrowing the money - from family, the overdraft, the credit card etc.
A want, well that is quite a different thing. We can manage without a want until such time as we can afford it.
But how many times to we tell ourselves that we need it......and we need it NOW.
* I need that pair of shoes
* I need a holiday
* I need another jacket, because I haven't got one in blue.
* I need a Chinese Takeaway
* I need to change the car
You get the idea. We can easily tell ourselves, and anyone else who we feel the need to justify our spending to, that it is a need, an absolute must have, that life just won't be the same for us if we don't have it. And because of that, even if we don't have the money to pay for it at the time, we are talking ourselves into adding it to the credit card, or dipping further into the overdraft.
Now, that isn't necessarily a problem. We can all benefit from something that makes our lives easier from time to time, and provided we can do so without causing ourselves financial stress, then we're not doing ourselves, or anyone else, any harm. The availablity of buy now pay later credit, either via credit cards and loans, or by instant credit from the likes of Klarna and PayPal Credit makes this an easy option - which for some, is simply a way of managing cash flow.
But for others, the "need" that we tell ourselves is a must-have-or-else, is being bought for all the wrong reasons. Perhaps it gives an instant buzz as you pay for it and take it home, but once you're home, you realise that you didn't really need it, didn't even really want it, and you don't get any benefit from it and it is a waste of money. Or a waste of money that you have now got to find and repay in the future
Perhaps the "need" is to avoid being judged by others for not having "the thing". Are you buying something because you feel you need (there's that word again!) to fit in, or keep up with someone, in some way?
Are you spending because you feel you need to make up for something - you are buying out of guilt (as a working mum, I was a great one for feeling the "mum-guilt" of going out to work and packing my children off to the childminder, so I would spend money on things they didn't really need, to try and make up for the lack of time I was spending with them).
All these are quite typical of the areas that crop up when I talk to clients about their money mindset, or read about in money forums online, and if any of the above apply to you, then working on your money mindset could be a very good investment of your time, so that you can manage your finances in a way that is more efficient, and also not have that constant feeling of doing things, spending money, etc for reasons that aren't purely about either basic needs, or truly giving joy in some way.
You see, you can be earning over £100k, and still have no money in the bank, or you can be on a £20k salary and manage to have money left at the end of each month, and savings to boot. It's not the amount we earn that's the issue - it's the mindset we apply to it that can cause the problems.
Personally, over a period of many years we became very good at justifying what we were spending money on, even when we didn't have the means to pay for it, or the easy ability to repay the money we were borrowing. It wasn't just justifying the takeaway, or the shoes. I convinced myself I needed to take flying lessons and get my pilot's licence. We convinced ourselves that we needed a boat.
(I did get my pilot's licence but then never did anything with it - that's another story entirely, and the boat only went out on the water a couple of times and spent several years on a trailer in the driveway before we sold it for less than we paid for it).
When I look back and think of all those things that I easily convinced myself (or, in my previous marriage the things we convinced each other of) that we needed, it is really quite sad. The amount of money we spent, that we could not afford, that placed extra stress on an already strained relationship. The people we thought we needed to impress, the feeling that if we didn't do or didn't have certain things, we would be judged as a failure.
The reality is quite different. The true NEEDS, yes, I get that there are times when we would have needed to borrow the money to get the car roadworthy to get to work safely. But were my true friends only friends because I had a story or two to tell about learning to fly, or because we had a sailing boat in the driveway? Were they only interested in me because of my impressive shoe collection, or the speed at which I whipped out the credit card to pay for lunch?
The marriage ended over 10 years ago (and we have both been much happier since) and amongst other things I needed to deal with, I dealt with the mindset issues I had around money, and how and why I spent it.
Now, having addressed the whole "need and want" issue, I can spend without guilt, without fear of judgment from others. It has taken time, and it hasn't always been easy, but I'm pretty much there.
That doesn't mean I don't still have the occasional regretful impulse buy, of course - I am only human.
And yes, I do need the shoes. Maybe I really need the shoes!
If you're struggling with your money mindset, and you would like to take steps towards ditching the money shame, the money guilt, and the ineffective ways of managing your finances, then, for the ladies only, head over to my facebook group where we provide a safe place to talk all things money, or if you want a fast track to dealing with your mindset, my money mindset mastery course is an ideal place to start!
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