THIS WEEK’S ACTIVITY: Differentiating between wants and needs
There are some items that we all need, like food and accommodation, but when it comes to what you want, it’s important to make the decision that is best for you. For example, someone might need a new car because they live far away from public transport, while someone else might want a new car because they don’t like the colour of their old car. Classifying your spending into ‘needs’ and ‘wants’ can help you to make decisions about how best to use your money.
Let’s start with needs
Take a piece of paper and divide it into two columns, Wants and Needs. What are the things you really need right now? It could be essential items like rent, paying bills and food. Maybe public transport so you can get to work. Whatever they are, list them under ‘Needs’.
Now let’s tackle the wants
So you’ve covered your rent, bills and transport, plus there’s enough food in the fridge to last until payday. Now list all the things you want, but before you run out and splurge, take a moment to ask yourself:
● Do I really need this?
● Do I need it right now?
● How will I pay for it?
● Can I wait until I have cash to pay for it?
● If I get a loan, how much will the interest cost me? And how long will it take to pay off?
Prioritising what you need is a great way start your journey to becoming a savings ninja. Remember, if there’s something you really, really want, you can still have it as long as your ‘needs’ are taken care of first.
For more than 10 years, ANZ, together with a range of community partners, has helped nearly 300,000 people worldwide improve their financial skills through the MoneyMinded program. It's been so successful, we've decided to share a few ideas with everyone.
Each Monday, we'll share a simple, fun tip. So whether you want to learn better budgeting tips, reduce your debt or start saving, check back each week to stay updated. You’ll be amazed what’s possible when you take it one Monday at a time.
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MoneyMinded program is an award-winning financial education course designed to help people build their financial skills, knowledge and confidence. Developed by ANZ, government groups and education experts, MoneyMinded has helped thousands worldwide and is still going strong.
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