You could be doing worse. You could be living in a radio station.

I was talking with a friend the other day about the guilt she felt about using borrowed money. This is the first time in her life she has been living purely on debt. Going back to school to get a doctorate can do that to you.

My friend has been responsible with money her whole life. Balancing her wants and needs has become harder with money she hasn’t earned. Being social is necessary for a happy life, but a craft beer with friends can feel frivolous.

We’ve all been there before. We fight with ourselves, our family, and society. I need to eat, but I want Oreos. I need money, but I want to be a musician. I need happiness, but I want HBO.

Defining wants and needs depends on who you ask.


An economics teacher might define needs and wants in terms of scale. A need, like transportation, is a good or service necessary for survival. A want, like a car, is a specific choice to fulfill your need.

Needs are constantly satisfied, and wants are never completely satisfied. Your tiny apartment fulfills your need for shelter, but you still want a townhouse to call your own.

This definition is fine for economists. It’s not so great to try and use every day.

Personal Finance Gurus

When it comes to your daily money, there are no perfect answers to help you define wants and needs. The differences depend on too many factors; I’m not even going to try to list them.

For example, make a list of the last 100 products or services you purchased. Find ten friends and family members of various ages and incomes. Have them separate the list into wants and needs. I’ll bet there will be many similarities and no two lists will be identical.

Buying food is a need. As much as I would like to buy a “Box of Food” and be done with grocery shopping, that’s not how life works. I might buy organic apples, Oreos, and a bag of Starbucks coffee in one trip.

Separating those three items into wants and needs could cause some couples to divorce. (The correct answer is want, need, and need.)

My Definition

When a client asks me to help them separate wants and needs, I focus on their goals. Tony Robbins has a great video about changing your “shoulds” into “musts.” It all boils down to how clear you are with your goals and purpose in life.

The story of how the media mogul, Cathy Hughes, started a radio station is incredible. For seven years, the radio station she was running was a financial disaster.

Ms. Hughes was not going to lose her company. This was her destiny. To put all her time and effort towards becoming a success, Ms. Hughes moved into the radio station with her son.

Sleeping on the floor of the radio station turned into a need. Everything else was a want.

That’s clarity!

Dealing with the Guilt

You don’t have to be as desperate as Cathy Hughes to feel guilty about wanting nice things. As a coach, I have no problem with you buying jewelry or enjoying luxury as long as it doesn’t interfere with your goals.

My wife and I make enough money to buy a Tesla, but we would have to stop saving for retirement and paying our mortgage. Thus, we can’t afford a Tesla right now.

If you want to stop feeling guilty about wanting or buying nice things, take the time to define your goals. You will be astonished at how much easier it becomes to decide between wants and needs.

I have one word of warning. It is possible to rationalize your wants and turn them into needs by choosing false goals. If your goal is to be happy and you believe that eating an entire package of Oreos in one sitting fulfills your goal, so be it.

I’ll be the first to admit that false goals catch up with you. To avoid them, surround yourself with advisors and mentors you trust. Those who have already walked your path can tell you where the traps are hidden.

In the end, the choice between your wants and needs is yours to make. If you want your choices to be easier, define clearer goals. Good luck!

Final Words

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