20 Sep 2012

Needs / wants


Once you've compiled a few months of expense reports, it's time to rip them to pieces. I find the best way to do this is to have two sections; one of your needs and one of your wants.


Needs

The needs section contains the bare essentials to living, shelter, warmth and food/water. This gives you a feel for how far you can cut costs whilst still maintaining some sort of a modern lifestyle. You have to remember that in many countries people have to go without these needs, not because they can’t afford it but because they do not have access to them.

Wants

This is for pretty much everything else, I still break this section down into its various types of spend. Car, home, lunch etc etc.

You’re probably thinking why the hell I would want to spend all my time doing this. Well you can then see all the superfluous things that you’re spending your hard earned cash on. Basically every £ you spend on something other than the essentials is a £ you've earned for no reason.

If you can reduce this spending to the lowest requirement you therefore don’t need to earn as much. You can therefore not work as much or at all!

Or continue working and start spending more on productive things like helping out charities or building a spaceship!

Imagine a spaceship! Your own freaking spaceship!

There's also the concept of fuck you money which I love. It's basically where you build up enough savings so that if your work ever crosses that line, whether unreasonably asking you to work yet another weekend, or asking you do something that is against your morals, you can just say fuck you and walk out the door. There's comfort in having a safety net like that, giving you the confidence to speak your mind when required.

Ever stress over needing that pay rise or whether redundancy is going to come knocking? This fear can be removed through the creation of these safety nets and the way to create them is to have control over your spending.

Freedom can be gained through increased control, it sounds weird but it’s true.

I’m not there yet, but I’m on the path. I’ve set a date of 14/02/2031 as when I can stop working. It sounds a long way off but considering I’ve only just started on this path it seems fairly reasonable to me. Especially as I have some big expenses coming up in the next year or so.


Photo by: boingboing

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