How to Save Money » Saving

How Many Of Your Needs Are Actual Needs?

As I type this post, the show Doomsday Preppers is playing in the background of my hotel room. As far as I can tell, the show isn’t available yet in Canada, so let me fill you in on what you’re missing.
The program profiles families that are preparing for certain doomsday scenarios. One family is prepping for an economic catastrophe, one that will see hyperinflation render their savings useless. Another family is preparing for a significant natural disaster, like a super volcano.
Their preparation methods are all pretty standard. They’re all stockpiling food, water, firewood, and most importantly, bullets. Hey, you gotta be prepared for the worst, right? When the unthinkable happens, these people will be prepared, and the rest of us will be regretting our lack of preparation.

But until this happens, these people are just a bunch of crazy extremists. We can all point and laugh at their crazy antics, content in knowing we’re all safe and sound, at least for now. As I watched the show, a personal finance related theme came to mind. Forget about the end of the world, or some major disaster, or anything else really bad happening. Let’s talk about needs, and what you really need.

We Can Live Without A Lot

Just 50 short years ago, we lived without smart phones, iPads, the internet, cable TV, satellite radio, Coke Zero, personal computers in general, calculators and reality TV. All of those things are pretty awesome except one, which I’ll leave up to you to decide.
It wasn’t that long ago we did without all these things, and we did just fine. Is it really so bad if our friends can’t text us every single minute of the day? Is listening to the radio with commercials really that bad?
Yet, when you make your budget, how many of these so-called necessities have you pencilled in there? If you’re anything like me, a whole bunch. I have cable TV, the internet, (obviously, since you’re reading this) an iPhone, along with probably a dozen other things I don’t need.
At the risk of sounding a little condescending, I’m quite okay with all the luxuries in my life. I don’t struggle with making ends meet every month. I save a comfortable percentage of my income. This post is being written in a hotel room a long ways from home, a trip I didn’t even have to budget for. I just dipped into my savings and was off. I’m in the position that I can afford a few luxuries.
What if you’re one of those people who struggle to make ends meet? Should you be cutting out some necessities.
You sure should be.

The Biggest Luxury of All

Okay, it’s not really the biggest luxury of all, but I needed a catchy title to get your attention. What is, at least in my opinion, the #1 thing you should be cutting out if you’re carrying any sort of consumer debt? No, it’s not your cell phone, or your cable TV, or even your Netflix subscription.
Nope, it’s travel.
It seems like everybody is touting the benefit of travelling these days. I’d agree with them for the most part. Going from cold, cold Canada to somewhere warmer in the winter is fantastic. Seeing the world is a pretty cool experience. I’m not here to bash travel.
I am here to bash travel when you can’t afford it. I know all sorts of people who are still paying off vacations they took years earlier, since they put them on their credit card. I also know all sorts of people who at least didn’t finance their holidays, but don’t have an emergency fund or any savings to speak of, because they’ve spent all of their excess cash on travelling.
Travelling is good. Putting yourself at financial risk to do it is bad. It’s the same thing with having a cell phone, or cable TV, or satellite radio. Travelling is hardly a necessity, just like any of those other luxuries.

Cutting Out Is Important

Take a good long look at some of the unnecessary luxuries in your life. Most of them are there for one purpose – to entertain. Just how entertained do you need to be?
The world is filled with free or almost free entertainment options. The library is filled with all sorts of stuff to keep you amused, basically for free. Going for a walk is free, assuming you don’t buy a pair of shoes just for walking.
How many of you actually use your Netflix subscription? Or your satellite radio subscription? Finding a substitute wouldn’t be that difficult, and can save you some money each month. Is cable no longer important? Then cut it. Don’t just keep it because it doesn’t seem like that much. These recurring costs have a way of adding up over time. What are you waiting for?


  1. AJMacD

    Very well put! I’ve been saying this kind of thing ever since I was old enough to understand wants & needs.

    The key to managing your spending is something I learned from my grade 9 Social Studies teacher – OPPORTUNITY COST.

    Before I make a purchase, I ask myself “What else could I do with this money?” If it’s a real necessity, I buy it. If it’s a luxury, I think about it for a while. I still buy treats & toys (like my new laptop), but I don’t need to always have the latest and greatest.

    My grandparents (WW2 generation) made a virtue of being frugal & thrifty, while people my age tend to scoff at and ridicule frugality. No wonder consumer debt levels are so out of control!

  2. Richard Rinyai

    My wife and I got rid of our cell phones ages ago. It’s amazing of how much we have saved over the years because of it. If I need to make a call, I can always pull over to a pay phone and pop in the coins. Much cheaper!

    We also use the public library for books and movies. The selection is huge for movies that just come out. Out tax dollars at work – finally!

    • betsy22

      This article hit one of my pet peeves – financial writers casually bashing cell phones as a luxury. Why not bash land lines instead? The cost is about the same – in fact, land line plans are often more expensive than a (non-smart phone) cell phone plan when measured alone (not bundled w/ internet and cable). Most of my single friends who are really pinching pennies have cut their land lines and kept a cheap cell plan….maybe it’s cheaper for a family to have a land line, but for most singles, a basic cell phone plan is about the same price and generally a heck of a lot more useful.

      Also, where are you finding all of these pay phones? I can’t think of any pay phones left in my neighborhood. I’d hate to be broken down after dark and having to rely on finding a pay phone somewhere in order to call a tow truck and have my friends come and get me.

  3. Ellen

    Great post. I agree with travel. Years ago, my now father in law mentioned he’d gone to Mexico. He said “We couldn’t afford it, but we went anyway”. I was horrified (I was fortunately raised in a fiscally responsible house). Travel is nice, but it’s a luxury, not a right.

  4. Steve

    I agree with everything except the internet. You can pry my internet connection from my cold, dead hands.

  5. Joe

    Food, water, shelter, clothing. I could live a lot cheaper in a homeless shelter and eating at soup kitchens. At what point have I sufficiently “cut” my wants to bare needs? I think it’s good to analyze your lifestyle and live on a budget, but at some point (when you have no debt, are saving 50% of your income and are worth over 100k in your mid-20s), you need to reconcile your desire for frugality with a lifestyle that permits healthy familial relationships (e.g. buying flowers for your GF) and reasonable comfort (e.g. paying an extra $30 a month in the summer to have A/C). This is called conscious spending and it’s a much more useful lens than the “what do I need to SURVIVE?” lens for frugality.

  6. Bridget

    Great post.

    I would say most of the things I spend money on are not needs — but I also don’t categorize them as needs. I never have.

    But I’m also not going to give them up 😉 I’m not living on credit and I am aggressively tackling my student loans. I guess you could argue that I could forgo every luxury in order to pay down my debt faster, but I think I’d burn out. I also have an emergency fund, retirement assets, and am working hard to save up for my goals. Travel is one of them!

  7. Becky P.

    Interesting that yesterday I was reading about the European Zone’s study on poverty and people are defined as poor if they have four out of 9 factors prevalent in their lives. Now I’ve not been able to find all those 9 listed easily, but apparently one of them includes not having a color tv in the house, and another is not being able to take a week’s vacation every year.

    I spent a while trying to find out what those 9 things were yesterday but haven’t found a nice succinct list yet. But here’s an article talking about it.

  8. TheWealthyIcelander

    Travelling is definetly an important feature and is to some extent “necessary” or very useful to broaden your horizon. However for people that “need” to travel its very important to save first before spending on travel.

  9. Young and Thrifty

    Getting rid of the cell phone is a hard one especially if you don’t spend much time home. But the other expenses like 700+ cable channels or the home phone that never gets used can go

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