I was walking down the isle and there it was. Bright. Shiny. Got to have it now. The inner struggle began:
A “It’s not in the budget”
B “That’s O.K. I just won’t eat for a week.”
A “We don’t need X, it’s just a luxury.”
B “You’ve worked so hard though, you deserve to have something nice.”
The inner dialogue continues until either the child wins and you march to the front with the purchase in hand or the adult takes control and leaves the store without making an epic budgeting mistake.
Have you been there too?
Needs vs. Wants
This might seem like an elementary discussion to have, but in order to win financially you have to differentiate and prioritize needs and wants.
Let’s be honest, needs aren’t very sexy or fun, but they have to be taken care of. Utilities, rent/mortgages, groceries, gas, etc are part of life and must come first.
The four walls: If you’re in a financial crisis, these might be all you can afford to pay. Housing, food, transportation, and utility payments must be protected before other debts or wants are purchased.
Wants are the impulse buys at the checkout stand and the flowers given ‘just because’. Wants have a place in your budget, but they won’t keep you on track to achieving your financial goals if you give in to them too often.
Tame Your Wants
Your wants are like an elephant driven by a tiny rider. They can be controlled for a while, but when the elephant is ready to go somewhere–the rider only holds on for dear life.
Give the elephant a peanut.
Trick and tame your wants by having a set amount each month for “blow money” or “mad money.” In your budget plan for wants and impulse buys. .
By giving in to the elephant in small amounts, you’ll keep him on track doing the heavy lifting. Even $5 a month in your envelope system is enough to keep the wanting elephant from running rampant.
These peanuts won’t be small forever. As your income increases and debt decreases, you’ll be able to increase the amount of blow money.
Control your inner child and tame your wants–your financial goals will thank you.
How do you control wants? Do you incorporate blow money into your budget?