3 Reasons You Should Regularly Examine Your Budget

3 Reasons You Should Regularly Examine Your Budget

March 17, 2022 0 By admin

3 Reasons you should regularly examine your budget in 2022 would be our topic for today. In this day and age, 2 years in with Covid-19 still lingering the planet, budgeting is important.

It is quite interesting to observe the budgeting aspect of life in 2022 and it is mainly because of the behavior of consumers towards virtually everything. The vast majority is into shopping online, being active on social media, always on the lookout for what is new and trendy, and sometimes this affects ones budgeting behavior.

That being said, we will be focusing on 3 things, the need, the want and the importance of it which as a lot of people nowadays tend to jump on impulse.

budgeting

 Budgeting: The Need

Most often then not, the word “need” is one of the first things that pops into anyones mouth, as an involuntary impulse based on signals acquired from either hearing or seeing things. The minute this signal is triggered, the automatic response is “I need this”. As opposed to “the want”, the need is more of able to give that importance but in some cases can be misunderstood as a hidden “want”.

When it comes to budgeting, the hierarchy of spending money always falls under the following:

1. Needs
2. Wants

And in some cases, it can be flipped depending on how impacting the product in question is. For example, “I need a new smartphone”, this statement is pretty common nowadays in 2022 even dating back 3-4 years ago. Society has been so into smartphones that every time a brand comes out with a new feature, the minute a consumer sees or hears that signal that drives the interest which then turns the need into a want.

However, there are also some people who legitimately need a product a be it for work, efficiency and the like and is sometimes perceived by people as people who just wants something as opposed to really needing the product.

Tip number one for “The Need”. To justify the need, you need to be 100% sure that this product you plan to purchase is indeed something that you need at that very moment as opposed to just a random thought that may play a role in your life down the road but not at this very moment. Determine the purpose and how it can elevate your life.

budgeting

 Budgeting: The Want

The wants is really more of that feeling where either you push yourself to acquire something, or someone or something is feeding the idea that you do “want” something. Generally people can throw this word around like It was nothing. Budgeting usually isn’t part of the equation especially for those who like living the one-day-millionare lifestyle.

Though I personally don’t really see anything wrong with “the wants” since the general rule is “you wan it, you work for it” but in some cases things can get a little overboard and would end up jeopardizing your financial state or stability.

The best tip I can recommend for this is simple, make a checklist of the things you want and try to put things into perspective on what is attainable without affecting your budget.

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Budgeting: The Importance

The third would be a combination of the need and the want, and this can be a bit complicated but is important nonetheless. Let’s say you’ve already made your budget for this months paycheck and have also made a checklist for the things that you want to acquire or purchase.

The key here is to determine the importance of the things that you want and how much you actually need the product as opposed to wanting the product.

Let’s take the example earlier as a highlight, the smartphone. We know for a fact that smartphones have made a huge impact with our daily lives, regardless of your profession or stature and yet a big percentage of consumers in the world constantly change smartphones in a year for numerous reasons in which affects ones budgeting capacity.

Be it as it may, regardless if one needs it, or simply wants it, the main factor to consider here is how important this purchase would be.

I actually use different platforms that provide guidance in terms of budgets, you can check one out here, but ultimately so long as you know deep down that this “want” is something you really “need’ and you know the importance of it to your lifestyle, then you’re in the clear (provided it doesn’t affect your budget).

For more in depth budgeting strategies, you can check out this article from Forbs, which focuses on strategies in 2022 and CNET as they’ve actually posted more tips that you can use to make 2022 a much more sustainable experience.

Some final thoughts to consider is to always observe, review your daily, weekly budget. Being able to keep track on it can not only give you that financial freedom but also be your saving grace during the rainy days.