sixtyandme logo
We are community supported and may earn a commission when you buy through links on our site. Learn more

One Piece of Financial Advice You Can Ignore

By Hanna Morrell March 23, 2024 Managing Money

If there is one piece of traditional financial advice I wish we all knew we could ignore, it would be:

“Only spend on what you need, not what you want.”

You’ve probably heard this piece of wisdom thousands of times in your life, and maybe you’ve even said it as many times! But the wants-vs-needs decision making strategy is probably the worst piece of financial advice for anyone.

Here’s why:

“Only spend on what you need, not what you want” isn’t working because:

  1. It’s too emotional.
  2. It’s too fast.
  3. It reinforces scarcity and failure.

It’s Too Emotional

It’s difficult to find two words in the English language that are more emotional than “want” and “need.” Essentially, we’re trying to make good, logical decisions using emotional language. Emotions are tools and are often a part of our decision making process, but using emotions this way is overly simplistic and not reflective of the complexity of our lives.

Emotional decisions are typically very fast and solve for only one thing. Here’s a story from another article about a couple, each partner is solving for one thing and making emotional decisions:

A couple, Sam and Mo, are shopping for a couch. The “right” couch is out there, they just have to find it, right?

Sam: Hey look, this one would fit great in the living room, and it’s in our price range.

Mo: Is it comfortable?

Sam: I don’t know, we could read reviews, or see if we can find it in a showroom.

Mo: Yeah, let’s do that. It doesn’t matter how much it costs if it’s not comfortable, right?

Sam: Yeah, but if it’s not in our price range it doesn’t matter how comfortable it is because we’re not getting it, right?

Each partner is solving for one thing. Sam is solving for price, Mo is solving for comfort. They both think what they’re solving for is the only logical thing to be focused on, and they’re both engaging in emotional decision making.

It’s Too Fast

It’s too fast and easy to justify a decision to ourselves. All we have to do is check the “need” box and move on. Combine that with the simplistic emotional reaction from above, and we’ve got a lightning-fast decision made with little to no thoughtfulness.

Most of the time we know at the moment that we’re using justifications (at least at some level), but in the absence of any other way to make decisions, justification is all we have left. We feel like we have no other choice, and that messaging makes it harder and harder to trust ourselves.

It Reinforces Scarcity and Failure

We have long memories for our own failures, and the wants vs needs strategy provides us with even more evidence that we’re not good at making decisions, even small ones.

And still we don’t evaluate the decision-making process we’re using, only ourselves. Maybe you’re not bad at using the “just focus on your needs, not your wants” strategy, maybe it’s just a bad strategy.

That failure tells us we’re never going to have enough, never going to be enough, and never going to make the right decisions, which amps up scarcity mindset and the pressure we apply to ourselves.

So how do I work with my clients so they can make better choices (financial or otherwise) without the wants vs needs thing?

I use and teach a tool that is a little slower, a little more detailed, but still easy enough to deploy in the service of making better decisions. And not just spending decisions, but in almost all decisions.

Note: This tool is best used for high-frequency, low cost/risk choices from daily spending up to a car purchase. For larger, low-frequency, high cost/risk choices like home purchases, starting or stopping relationships or jobs, this tool will not suffice.

Step 1: What Are the Possible Values of This Choice?

The value of choice CANNOT be its price. Too often we conflate the value of something with its cost.

And we’re not just talking about its monetary price, but also in the time and energy cost of a choice. Essentially, what service does this choice, purchase, or option provide to you?

Let’s consider the question of buying a bottle of carbonated water and practice this idea of values assessment to dig a little deeper.

Possible values of a bottle of carbonated water:

  • Hydration is necessary for life.
  • It’s cold and I’m hot/ it will be refreshing.
  • It’s convenient.
  • It’s delicious.
  • It’s __________.

There are echoes of the WvN assessment here, right? That’s ok, we just need to explore and dig into the reasoning a bit more.

Let’s think about the value of “delicious” for a moment. While we are intentionally using language that steers us away from emotion, we do need to factor it in to our assessments. I love carbonated water, but someone who finds it disgusting would evaluate this differently. What you find satisfying, pleasurable, comforting, nourishing, disgusting, repulsive, or nasty should be part of this assessment, but it should not be the only thing we use to evaluate our choices.

We’re just practicing on a bottle of water so our list won’t be very long. What other values of this bottle of water can you think of?

Step 2: What Are the Possible Risks Associated with This Choice?

The risks of a choice CAN and should include its cost. The monetary cost of this bottle of water was $3. Applying the concept of an opportunity cost to this is pretty intuitive…. Once I spend this $3 on this bottle of water I cannot spend that same $3 on anything else. I can spend a different $3, but not THAT $3.

Where opportunity costs can get fairly philosophical is when we apply the same concept to the time and energy it took to make that $3. Even if I’d found $3 laying on the ground it would have taken me a very little bit of time and energy to pick it up. I cannot spend that time and energy on anything else.

Economics typically focuses the opportunity cost on monetary costs, but rarely turns that same assessment on how we spend our time and energy.

We can always make more money. We can always make more energy. The one thing we can never make more of is time.

So we have one risk so far:

The opportunity costs of spending my time, energy, and money on this bottle of water.

Other risks could be:

  • It could be flat.
  • It could have been manufactured incorrectly/gross.
  • It could be ________.

What other possible risks can you think of for this bottle of water?

Step 3: Is There Any Other Way?

Specifically, is there any other way to get some of the values without some or all of the risks.

Let’s go back one last time to the convenience store where I’m standing with my bottle of water. In just a few seconds, I’d run through the possible values and risks of buying this bottle of water, now I ask myself, “Is there any other way to get some of the values of this bottle of water without some or all of the risks?” I turn my head, looking around, and guess what I see…

A drinking fountain. One of the big refrigerated ones. I could have then done the assessment again with the values, risks, and any other ways of the drinking fountain, but instead I just put the bottle back and sucked down a bunch of refrigerated water.

Sometimes there is no other way. What is important is that we are taking the time to LOOK for other ways.

Often in the headlong press through our lives we don’t look for other options. Feeling like we don’t have or can’t take advantage of more than one option is a kind of crisis. By teaching ourselves (and others) this three-step assessment we bake in the idea that we always need to look for other options.

What are some Any Other Ways for this bottle of water?

  • I could get a cheaper bottle of boring water.
  • I could hold out until I get home.
  • I could drink from the drinking fountain.
  • I could get a cup and get water from the soda machine.
  • I could ______________.

Step 4: Repeat

Repeat the assessment as many times as you like with as many Any Other Ways as you like.


Kids get a kick out of playing this as a game, and I encourage it as a decision making tool you can teach off-the-cuff that will ultimately serve your grandchildren by helping them slow down their decision making process.


Let’s Have a Conversation:

Do you consider purchases based on wants or needs? Have you ever thought to slow down your decision making process? What tools have you learned to use that make sense for your finances?

Notify of

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Inline Feedbacks
View all comments
Joyce Ramsay

Thank you Hanna for your insights. I try to balance my life with indulging in a few wants (small-sized) but still leave sufficient for the essential needs (bought a block of land, new house and shed coming up). I am only able to do this now as I have been prudent with investing and spending with the little I had whilst raising 2 sons single-handed. I call the little wants I invest in ‘my rewards for good behaviour.’ Also, I have always been very analytical and now, I am trying to switch off that button and listen to my instincts or inner voice. That tells me in an instant whether my proposed action will be good, bad or neutral.

Hanna Morrell

Hi Joyce! Oh I love this! I love that you are learning to trust yourself and your insticts! We’re capable of amazing things when we can trust ourselves! Well done, Joyce!


I don’t think you clearly showed the whole picture in this article. You left out the important factor of fiscal responsibility. I pay attention to what I spend – making certain that I save into an “emergency fund” as well as paying off all my credit card charges each month. If a person has credit card debt, but still buys “wants” before paying off their debt, (usually those “things” they could not live without but didn’t “need” that mean very little to them now), they are being financially imprudent. The cost of living well in the future may mean NOT buying that desired “want” today.


I totally agree with you. We have 2 acquaintances who are constantly maxing out their credit cards on things like the latest iWatches and phones, even silly things like a drum kit and an electric cello. They bought a vintage Jeep they couldn’t afford on a credit card purely because it was yellow, it has never moved in 5 years because unknown to them it had a gearbox issue. They justify their spending by saying they work so they deserve nice things. It didn’t go down well when I said they needed to pay off their creditors first, they even owe money to her parents who remortgaged their small business premises to loan them money for a house they can’t afford. The parents need the money back or they can’t retire.

Hanna Morrell

Hi Terri! Well you’re right there, of course I couldn’t address every part of financial decision making in one go. And I couldn’t agree more that we need to pay attention to what we spend and make thoughtful intentional decisions. I can tell it’s important to you that people are making the correct decisions!


I have to disagree with much of the content here, not that there aren’t some valid points. In a financial environment which is worsening, not improving, women need to be evaluating their spending choices more carefully than they were a few years ago. A consideration of wants versus needs is still very relevant. Especially for women who are at, or near, retirement, that money that is spent on wants may not be easily replaceable and available when more pressing needs arise. The reality for many women is that we can’t always make more money, and we may have a lot of time in which to regret bad spending habits.

Last edited 22 days ago by Nancy
Hanna Morrell

Nancy I couldn’t agree more that women need to carefully evaluate their choices! That’s what the values/risks/any other way strategy laid out in the article is for! It’s designed to be a more thoughtful version of wants vs needs to allow for our complicated lives and be less emotional than wants vs needs.

Ciara Roots

I have lived below my means for all my life. At 73, I’m glad I did, because I now am in a position where I need the funds I have. I can’t imagine what a spot I’d be in if I didn’t have that money.

Hanna Morrell

Ciara I’m so glad your past self made those sacrifices so you right now can breathe easy!

The Author

Hanna Morrell is a holistic, trauma-informed financial coach who helps people trust themselves with their money. Her adaptive curriculum respects that every decision we make is either directly or indirectly a financial decision. Hanna delights in teaching her clients how they can build and customize their own money systems.

You Might Also Like