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Be Wise With Money

Needs vs. Wants: Where's Your Money Going?

monthly expenses

The most recent Bureau of Labor Statistics report (April 2016) shows incomes on average rose 6.6%, but several expense categories had annual double-digit increases. No wonder it's hard to make ends meet!

Some good news despite expense increases

Expense categories with annual double-digit increases are:

  • Apparel – 12.6%.
  • Vehicle purchase – 11%.
  • Health insurance – 18.6%.
  • Education – 19.2%.

In addition, the latest CareerBuilder survey showed that 40% of workers are living paycheck to paycheck. And, we're all too familiar with the higher healthcare costs and low interest rates on savings.

Still, many positives came out of that news. For example, 67% contribute to their employer retirement plan, and 72% surveyed said they are more fiscally responsible now. The vast majority said they cut back on leisure activities.

“Necessary” expenses?

But many said there are expenses they couldn't do without.

  • Internet connection – 57%.
  • Driving – 44%.
  • Their pet – 39%.
  • Cable TV – 29%.
  • Mobile phone – 24%.

Prioritize your spending to make the most of your income

Sitting down and determining what your big priorities are can help you decide where to shift your financial resources and not feel the monthly pinch.

Tools to help you:

  • Balanced spending worksheet to minimize that inner nagging voice.
  • Control your spending leaks to pay for things that matter most.
  • BalanceWorksTM, a money management system from Thrivent Federal Credit Union that makes it easier to build savings and track spending.

Understanding what expenses are truly a need vs. a want can help minimize the month end pinch.

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