People hate budgeting because it often means cutting out fun. Or at least that’s how it’s perceived. Unfortunately, the cornerstone of getting your financial life under control is budgeting. If it were easy or enjoyable, everyone would already do it and I’d be out of a job. Maybe only some of us find the process of making a budget fun, but sticking to a budget means you’ll be able to have more fun.

If you’ve ever read a book, blog, or listened to a podcast about budgeting, chances are they spoke about separating your spending into “Needs” and “Wants”. Eventually they tell you that you have to cut things from your “Wants” column - things like going out to restaurants, splurging on your pet, gym memberships, or the classic scapegoat, a daily latte.

Corgi-butt-dancing cappuccino is 100% a need.

If you are a person who loves spreadsheets, personal finance, and managing money, this makes total sense. Perhaps we’re a colder, more Spock-like bunch? From our 30,000 foot perspective, it’s simply rational money management. If you have limited resources, then what you don’t need has to go. So stop whining about eating gruel and get back to your desolate cave, you spoiled, hedonistic cow.

The thing is, all spending is a need. Let me repeat that and put it in yell-y caps ALL SPENDING IS A NEED. The difference is that some spending allows us oxygen-breathing, carbon-based organisms to continue to live on this planet, while other spending makes living on this planet worthwhile.

Please don’t get me wrong - I’m not advocating consumerism as a means of personal fulfillment, quite the opposite. I’m advocating for us to understand our emotional needs and then make adjustments in our spending to meet these needs. A well-designed budget will allow you to not just survive, but to afford the things that let you lead an enriching life.

When we cut the “wants” from our budget, we are denying ourselves the pleasures that make life fun and enriching; and doing that is setting ourselves up for failure. Instead, we need to recognize our emotional needs and prioritize them within our budget. Let me explain how “wants” aren’t frivolous using my examples from above.

Going out to restaurants could fulfill our needs for:

friendship/support
community
novelty and new experiences

Spoiling your pets is a matter of course; our pets improve our lives exponentially and deserve only the very best - right?! (That’s what my cats tell me.) They address our needs for:

love
having someone/thing to care for
comfort
laughter
diversion

A gym membership provides:

physical health
mental health
a feeling of strength (sometimes more than others)

Lastly, our daily lattes can provide many things we need:

relaxation
focus
a small pleasure that gets us through hard days
a spot away from the house and work where we can be creative, productive

Imagine your days without community, support, love, relaxation, health, etc. That’s the life we offer people when we tell them to cut out their “wants”. Basing a budget on removing fun from our lives doesn’t work. It’s basically Azkaban. All your needs are met but you have no joy or happiness. It does not go well for those inside.

To be fair, when money is tight - genuinely, really, really tight - the stuff that doesn’t keep you alive is the only place you can cut from because, by definition, you don’t need it to live. No matter what your financial situation is, you will always have emotional needs. Like everything else in life, money gives you options, in lieu of that, you will probably have to get creative to meet these needs.

When we understand the underlying emotional needs our spending fulfills, we can use different tactics to satisfy these needs while keeping our spending down. That’s what a good budget does. That’s why a good budget isn’t restrictive. It frees us to live how we want to.

The book “Loaded” by Sarah Newcomb, PhD, originally turned me onto the idea that spending fulfills emotional needs which must be met somehow. For years I hated telling people they had to cut out the things that brought them joy - but didn’t know what to tell them instead. Needs/wants was the rule. I strongly recommend this book for financial coaches/therapists and anyone who wants to make massive change in their financial life and is looking for a system that takes their whole life into account. Full review to come. (Amazon link here)

Newcomb argues that we should recognize what emotional need is being fulfilled by our spending behavior and find a strategy that will satisfy the need without breaking the bank. Want to connect with friends and try a new restaurant? Instead of going out to dinner, go for lunch or happy hour drinks/appetizers or eat food truck tacos in a park. How do we show our pets we love them back without buying them a(nother) $60 bed? Spend more time playing with them. Take your dogs out to their favorite parks. Make your cats a cardboard box castle. Physical health? Try online subscriptions to work-out from home, jog outside, ditch the expensive gym for a cheaper one and actually go. Yummy latte? Budget for that life-bringing deliciousness. A yummy latte is a beautiful thing. That goes doubly for lattes with a dancing corgi on top.

With unprecedented unemployment and an insufficient social safety net, just keeping yourself sheltered, eating, and the lights on may be hard enough. Financial hardship is incredibly stressful on many levels. It affects your health, your relationships, your self-worth, your security, to name just a few items. A small encouragement is that so many people are hurting, there are now many new or expanded services to get you through. Get as much help as is being offered - find your local food bank, talk to your loan servicers about deferment/forbearance, check 211.org for other local aid, address the mental toll Covid is taking. Please, take care of your whole self - you aren’t alone and you aren’t crazy or weird for feeling the heavy emotional pressure of these times.

“Pay yourself first” usually means put money into savings, but I want you to also prioritize things that enrich your life. Whatever you do, don’t put yourself last on your budget. Know what your emotional needs are and make sure you are satisfying them . You’ll have less stress, enjoy your life more, have fun, and have a much better chance of sticking to your budget so you can achieve your goals.

Cheers,

Ms. Moody

Overthrowing the "Needs/Wants" Binary