Attention, personal finance readers and gurus! You think you know the difference between a need and a want – right? Really, are you sure?
Why do we care about want vs. need?
Most financial literacy courses and parents in the know believe that teaching the difference between something you need and something you want is key in being able to control spending and thrive financially. Parents start teaching this concept when a child is a toddler and continue to try to drill it in all the way through the teen and college years.
What is a want?
I think most of you would agree that a ‘want’ is an object, experience or item that is not vital to your life – something you could do without. An example of a ‘want’ is your toddler lusting after the Baby Alive! Doll.
What is a need?
Likewise, I believe you would agree that a ‘need’ is something that is vital to your life – something you cannot do without. A lot of you would classify indoor plumbing, central heat, grocery money and gasoline as ‘needs’.
But wait, are they really always needs? Absolutely not!
My Grandmother was born in 1898. She lived on a farm. The house did not have running water, central heat, or electricity. A lot of times, she didn’t use grocery money either. Each morning, she pumped the well pump to fill a bucket with water to use for washing hands, drinking and cooking that day. On wash day, she built a wood fire out in the yard under a big iron cauldron to heat water to wash her clothing. She raised her own fruits and vegetables, kept chickens for meat and eggs, cows for milk and cream and lambs for wool and meat.
In winter, she and Grandpa cut ice from the pond and put it in the ice house to try to save it for summer. Three rooms were sufficient to heat in the winter – the kitchen, the living room and the bedroom. Other rooms were closed off. If it got too hot in the house in the summer, they carried their bed outside and slept in the summer breezes.
She didn’t need to pay utility bills – wood for heat and cooking was obtained from the farm. Water was drawn from the well. Light was obtained from oil lamps (and yes, she did need to buy that oil). Food was preserved by canning, drying or storing in a cool cellar or the ice house. If she wanted to talk to someone, she walked on over and had a conversation, or hitched the mule up to the wagon and rode over. The double seat outhouse worked fine during the day and a chamber pot worked for us kids at night in the house.
In her early and middle adulthood, her environment allowed her to consider our ‘necessities’ as ‘wants’ instead of ‘needs’. What did she think about these things: Indoor plumbing? Don’t need it, we’ve used an outhouse all our lives. Telephone? Don’t need it, but it is nice to have – now we can listen in on our neighbor’s phone calls and talk to them anytime! Electricity – it’s great to have, but we did fine most of our lives without it! A car? Wow, what a luxury!
In today’s world these things probably are really ‘needs’ for most of us. Our environment does not really permit using outhouses in crowded city living areas. Most of us don’t have access to enough wood to keep ourselves warm during winter months. Our livelihoods depend on us being able to get back and forth to work and most of us live too far away to walk, bike or ride our horse.
Your environment defines what is considered a ‘need’.
My Grandmother lived in a different environment and had different needs than I.
The Amish, due to their chosen simple lifestyle, probably have a somewhat different perspective than most of us on what is considered a need vs a want.
If you live in Arizona, you probably think air conditioning is a need, but if you live in Wisconsin, perhaps not. If you live in Switzerland, you may think a pair of snow ski’s are a need, but if you live in Florida, perhaps not.
What is a need? For humans, the most basic needs are air to breathe, some kind of food to eat and water to drink. Secondary needs are shelter, a way to keep warm and a band of brothers to hang with for protection. For anything beyond these to be considered a need – you should examine your environment to determine if it really is a need for you.
The moral of this little post is that you should look closely at the things you are teaching your children as ‘needs’ and help them understand that at times the ‘need’ may actually be a ‘want’.
What do you consider a ‘want’ that most others consider to be a ‘need’?
This post was written by Marie.