BMO Harris' Financial Tip of the Week: Needs and Wants: It's Important to Know the Difference

CHICAGO, Sept. 13, 2012 /PRNewswire/ -- As part of BMO Harris Bank's ongoing commitment to financial literacy and Making Money Make Sense, BMO Harris is providing weekly financial tips. This week's tip offers Helpful Steps to control your spending. 

Wondering why you can't seem to manage your spending? One reason may be a tendency to confuse what you need with what you want, which can lead to unwise buying decisions.

While there's nothing wrong with buying things that aren't exactly life's necessities, doing this too often could get you into financial trouble.

Here are a few tips that can help you gain control of your spending.

Before you buy, pose the "want versus need" question
Each time you go shopping, ask yourself whether the item you're considering is something you really need or something you just want. You'll be surprised at how often you end up putting something back on the shelf because, let's face it, did you really need another black sweater or that new set of high-tech golf clubs?

Learn to delay gratification
All right, so you've decided that you need to take that one-week getaway to the Bahamas. Your job is extremely stressful and you're at the breaking point. But before you book your flight and hotel, sleep on it. You may still feel the same way in the morning, but it's good practice to take some time to think before you buy instead of constantly making impulse purchases.

Make a shopping list
Before you head out to the supermarket or shopping mall, make a list of the things you want to buy and the approximate cost of each item. Then add everything up. If the total exceeds what you can afford to spend, go through the list and put each item through the "want versus need" test. Highlight the "want" items and take them off the list one by one until you reach a more reasonable total.

Don't forget to reward yourself
While managing your spending is critical to a sound financial future, it's also important to enjoy your money. So if your budget allows it this month, go ahead and treat your family to dinner at that ritzy new restaurant. Or buy that mobile phone with all the bells and whistles you've been dying to play with. By keeping your indulgences within a reasonable limit, you'll enjoy them more knowing you've got your spending under control.

To learn more Helpful Steps visit, https://www4.harrisbank.com/helpful-steps/helpfulsteps/index.html

About BMO Harris Bank

Based in Chicago, BMO Harris Bank N.A. provides a broad range of personal banking products and solutions through over 650 branches and approximately 1,350 ATMs in Illinois, Wisconsin, Indiana, Kansas, Missouri, Minnesota, Nevada, Arizona and Florida. BMO Harris Bank's commercial banking team provides a combination of sector expertise, local knowledge and mid-market focus throughout the U.S. Deposit and loan products and services provided by BMO Harris Bank N.A. Member FDIC. BMO Harris BankSM is a trade name used by BMO Harris Bank N.A. BMO Harris Bank is part of BMO Financial Group, a North American financial organization with 1,600 branches, and a retail deposit base of approximately $180 billion.

SOURCE BMO Harris