To say 2020 has thrown us some financial curveballs would be an understatement. At Urban List, we’re all about helping you to live your best life now and in the future, which is why we are here to help you manage your finances. The Financial Wellbeing Bootcamp brought to you by ANZ, is inspired by their four-step financial wellbeing check-in and is loaded with tips and insights to help you get on top of your money, so get ready to be schooled.
Strap yourself in for the first step of achieving financial wellbeing, planning your budget. Here, we’re unpacking how identifying your wants versus your needs can help even the biggest spender manage money more mindfully.
Identifying Your Needs
To identify your ‘needs’, look at your lifestyle and notice the things that are totally necessary to live. No, we don’t mean your wine subscription—although, feels. We mean shelter, food, water, warmth and essentials.
Your needs will likely include your rent/mortgage/board payments and utilities, plus a realistic but sensible food shopping allocation, medications, and any equipment that you require to do your job.
Financial wellbeing is all about building confidence around money. By focusing your attention firstly on your needs, you could ensure you won’t be left unable to cover essential living costs. If you’ve ever found yourself behind on bills and wishing you could return one of your several polyester dresses, a needs-first mindset could help you feel more financially secure.
Identifying Your Wants
And, now for the fun part! You might think budgeting and fun don’t belong in the same sentence, but with the right budget, you can allocate money to the things you love, avoid feeling restricted and still hit your savings goals – all while doing what works for you. We’re all ears.
It’s all about getting organised and purposeful with your wants. Firstly, take stock of what really brings you joy. We mean real, meaningful joy here, not mindless online shopping splurges that you ultimately regret after one wear. It sometimes helps to look back over bank statements or even photos in your camera roll, and find the things you’re really happy to part with your hard-earned cash over.
Identifying The In-Betweens
You might find some aspects of your lifestyle are want-need hybrids. This might include things like a gym membership, a subscription to Audible, or perhaps things that support your mental health like meditation apps or yoga equipment.
While they don’t meet the intrinsic survival element of the ‘needs category’, they have far more importance to your overall well-being than your love of Aperol spritz.
With these types of spends, you can classify them somewhere between needs and wants. This way, if there comes a time when you need to cut back on expenses, you can trim the fat from more superficial ‘wants’ before you cut back on the nice-to-have extras.
When you fine-tune your ability to distinguish between wants and needs, it becomes easier to make qualified purchase decisions that don’t derail your financial progress. It’s small, simple changes like these that can create lasting impact to your money mindset and financial position.
Stay tuned for next week’s Financial Wellbeing Bootcamp, brought to you by ANZ, where we’ll show you a budgeting technique that leverages these want vs need distinctions into a strategy that could help you budget like a boss.
Looking for more ways to spend more mindfully? Click here to discover an Easy-As Budgeting Technique That Could Help You Live Your Best Life and Save Like a Boss.
Image credit: Christian Vierig
Editor’s note: This article has been written and published by Urban List, and is sponsored by ANZ. Unless otherwise stated, all views and opinions belong to Urban List. Thank you for supporting the sponsors who make Urban List possible. Click here for more information on our editorial policy.