Savings Challenge #3 – Wants, Needs and Must Haves

Savings ChallengeWhen looking at your expenses, it is easy to see big numbers and immediately start making sweeping cuts. No more eating out! I need to start extreme couponing! I will start cutting the kids’ hair at home. No more doggie baths. Not always realistic, and I don’t recommend knee-jerk reactions to your budget tracking.

The first thing you need to do is decide which categories are most important to you. Only you can decide what is important to your family, what your must-haves and needs are, and what are just plain wants.

Sitting at my daughter’s dance class, I hear the most interesting conversations.  It is so strange to hear people discussing their lives and the minutiae of their days. It is also telling about individual spending habits.

I live in a somewhat affluent neighborhood,  many moms are stay at home moms with husbands who work long hours and travel a lot. I feel blessed that I have flexibility afforded by my husband’s hard work, but listening to what people find important is amazing.

A well dressed mom discusses how hard it will be to make anew upcoming move for her husband’s career. She tells how difficult it is going to be to move the family largely by herself.  They are not hiring a moving company,  but rather using a self service moving van and “pods”. Then the next moment she talks of a major (expensive) department store’s sale. The woman next to her talks of having a personal shopper from the same store cleaning out her closet and sending her items at regular intervals.

Having just recently moved for the third time with my husband and now two kids, I can’t imagine not having a moving company.  Granted,  I did most of the packing,  but having to take things in and out of the truck and moving things around just sounds like a nightmare.

On the other hand, I rarely buy clothes from that department store,  it would be an extravagance to have a personal shopper.  Especially with me wanting to lose a bit of weight,  I spend most of my money at Target for clothes for myself and the kids. I do try to make sure my husband is well dressed,  but he isn’t buying expensive clothes all the time. And he definitely doesn’t go to places where there are personal shoppers.

We just have certain things that we are ok spending money on, and other things just are not a priority.  It is pointless to try to cut your budget until you understand what it important to you and your family.  I am okay eating out less if we can still have nice dinners out as a couple from time to time.  I can cut cable TV if I have a reasonable replacement,  it is silly to think that I will do more outside the home to replace television.  It makes financial sense as well as a more active lifestyle,  but I have two kids, so getting out of the house is more trouble than it is worth sometimes.

Once you take a look at where you are spending money,  it is vital to start assessing what expenses you can’t do without,  or need to keep some budget for, and what is not mandatory for a full life. Once you figure out what the different expenses mean to you, you can actually start making changes.

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