“In these challenging economic times I feel a little guilty when I spend on trivial items. I’m currently saving more than ten per cent of my salary and I have never been careless with my money. Is it financially unwise to buy something just because I want it?”

Financial wisdom normally dictates that people should spend their money acquiring the things they need instead of splurging on things that they want. A need is something that the human body requires for survival, such as food, shelter, and clothing.

In reality, most of the things we spend money on are things we want, not need. But wouldn’t life be boring if we only focused on our basic requirements all the time? Is there any way to get both what we need and what we want?

If you’re a consistent saver, generally sensible with spending, and not burdened by consumer debt, it is possible for you to have the best of both worlds. While you shouldn’t throw caution to the wind, there are some financially smart ways to reward yourself without feeling guilty.

Budgeting To Meet Your Wants

One way of catering for your wants is to plan for them in your budget. The great thing about a budget is that it gives you the power of choice – you can actually get both needs and wants by choosing how and where you spend your money.

The first step is to download a personal budget from the financial tools section at www.financiallysmartonline.com. Record all the mandatory things you need to spend on such as groceries, rent or mortgage, utilities and children’s expenses. Then consider all those essentials that don’t occur regularly such as cooking gas, insurance or school fees, and calculate the average monthly amount for these items. Finally, set aside allowances for emergencies and medical expenses.

After you have entered amounts for these needs, consider the things that you want. Always desired to stay in a luxury resort? What would it cost? Been thinking about redecorating your bedroom? How much would you have to pay? Now look back at the entries in your budget and decide if there are any expenses that could be reduced in order to get some of the things you really want.

For example, you may have included your cable bill as a compulsory monthly expense. But do you really watch that much TV anyway? What if you temporarily suspended the account and saved up enough money to afford the item you desired? Look at your grocery list for things you can sacrifice for a few months in order to get what you want. It just might be worth a few lunches of crackers and sardines!

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I recently went to a friend’s garage sale, taking only $1,000 with me as I was determined not to overspend. I discovered two $500 books on finance which would be very helpful for my business. Then I saw a $500 trinket box that perfectly matched my office decor. In one hand I clutched the two books that I needed; in the other I tentatively held the box that I really wanted. In the end, I compromised by giving myself both; I was satisfied that I had stuck to the game plan, yet thrilled that I had acquired the object of my desire.

Earning To Achieve Your Wants

As a financial advisor I don’t always tell people to give up non-essential spending; if they really want to attain a certain lifestyle, I tell them to find ways to earn more money. Unfortunately, many people don’t see the connection between working smarter and achieving the finer things in life, choosing instead to overuse credit cards and payroll loans for instant gratification.

Do you know how much it would take to live the life of your dreams? Too many of us accept our current existence, never believing that it’s possible to get what we really want. It’s almost impossible to hit an invisible target, so use your budget planner to help you set earning goals to achieve your wants.

After you have filled out your real-life budget, then calculate the cost of the things you would like to have, such as an annual vacation or investments towards an early retirement. Once you have totalled the expenses in your dream budget, you’ll now have a target earning amount to turn your wishes into reality.

The next step is to design an action plan to increase your income over time by actively looking out for opportunities when they present themselves. Remember that challenging times always present openings that enterprising persons can take advantage of. Examine your surroundings – your workplace, school, community – and try to identify problems and needs that you can solve. Get creative in using your talents to generate extra money.

With savvy money management skills and smart income-earning options, you CAN satisfy both your needs and your wants!