Do we really need everything that we want?
It’s interesting that when the price of gas dropped so dramatically in the past several months that consumption never rose to the levels before the high cost caught us off guard this past summer. Do you wonder why spending is still off even with some of the deepest discounts retailers have ever offered consumers in years past? Are we actually taking a cue from the fact that we don’t necessarily need as much?
It’s a scary thought, I’m sure, to think that excess is something that isn’t on our plate that we strive to have, especially with the numerous large companies being vilified in the media due to their greed. When I’ve done budgeting with people, I’ve always asked them what is a ‘œwant’ and what is a ‘œneed’ and to be sure to differentiate between the two.
It’s not always easy for people to see this side of them, and a recent poll has stated that the majority of Americans feel that the media has done nothing but feed this frenzy about the recession, causing further troubles in the economic outlook. So this begs the question, did the media actually help people realize that they don’t always need that new outfit every week, or that a new car is not a necessity every 3 years?
Personally I’ve always been one to try to save money where I can because it’s what my business is about, although I’ve also learned that after reading another recent Queercents article regarding food budgeting, that I actually spent the time to look and see how I performed compared to the USDA chart. My household actually ended up on the border between Low-Cost and Moderate Cost. I actually ran my Quicken report on the previous year, and although the beginning of 2008 seemed to be a fairly robust start, things did change over the course of the year regarding spending. Eating went down, discretionary spending went down, and my life wasn’t affected all that much overall, except I kept making sure that I went to the grocery store armed with my coupons and always looked online for anything else that I could use.
When the times get better (which they will eventually because it’s the way the economy works), will we as a whole be less inclined to be spend extravagantly but more inclined to spend fruitfully on what’s necessary? People, as well as businesses, need to take notes on what they’re doing and what they need to continue to do right now. It’ll be a senseless shame if after this time in our lives we don’t learn from our mistakes.
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Dwayne J. Briscoe, Owner
Bookkeeping-Results, LLC
Dwayne@bookkeeping-results.com
Photo credit: stock.xchng.
Dwayne, I think this is definitely the case with people who lived through the Depression and WWII. In my grandparents’ case, they never throw ANYTHING away because they might “need” it one day. My grandma, in particular, refuses to throw out food because she lived in Holland during the worst years of the war. Even if something has a layer of mold on it she will scrape off the mold and eat it anyway because she’s seen what life is like when you don’t have a choice.
I think there’s a balance to be had between living frugally and totally going on the deep end. While I think it’s important to reuse things as much as possible and to live within your means, I also think you have to let things go.
I do hope that the silver lining to this economic crisis is a cultural change toward saving and a more long-term view. People shouldn’t need financial advisors to tell them they need to have enough money to cover several months of expenses, to budget for unexpected problems, to save for retirement. This should be basic knowledge that kids are taught from a young age and that everyone hardly has to think about. It should be part of the culture.