Needs Vs. Want

By Hightower Westchester on October 3, 2014

I often find myself having this conversation with my daughters, what you need versus what you want. They want the newest iPhone (6) but they don’t need it. What they need is a cell phone of some sort. But who doesn’t want the newest shiniest thing. However I am sure they will end up the new iPhone, because sometimes a need is just too difficult to say no to.

A few years ago my wife and I had this conversation about giving to charity. We made a decision to focus our giving on smaller local charities to have an impact close to home. While my alma mater wants my money for their scholarship and endowment funds they don’t actually need it, they have millions. But our local food bank needs our money to feed people in our community. After all food is need that all of us have, while we may want to dine at five star restaurants because the food is incredible we don’t need to eat there.

So too does this want vs. need apply when we talk to our clients about financial planning. When we begin our review to build a comprehensive financial plan we look at a client’s wants and needs. We all need a place to live, so we need a house as an example, but we don’t need two or three of them. It might be a want to have a vacation home someplace warm or snowy depending on your recreational preference, but it’s clearly a want. We all need to take a vacation to unwind, but we don’t need to go to the French Riviera, although it’s a nice want.

When it comes to financial planning like all aspects of your life it’s about prioritizing your wants vs. needs. Do you need a new car every 3 years, or will 5 years suffice. Do you need the latest iPhone like my daughter or is your current one sufficient until it starts to die.

As long as we are breathing there will always be this battle between needs and wants ultimately it’s about prioritizing what want is important to have versus what I don’t need.

Remember no one plans to fail, but you can fail to plan.

Peter Lang – Managing Director – HighTower Westchester

914-825-8631 – plang@hightoweradvisors.com

HighTower Westchester is a team of investment professionals registered with HighTower Securities, LLC, member FINRA, MSRB and SIPC & HighTower Advisors, LLC a registered investment advisor with the SEC. All securities are offered through HighTower Securities, LLC and advisory services are offered through HighTower Advisors, LLC.

This is not an offer to buy or sell securities. No investment process is free of risk and there is no guarantee that the investment process described herein will be profitable. Investors may lose all of their investments. Past performance is not indicative of current or future performance and is not a guarantee. Before investing, consider the investment objectives, risk, charges, and expenses. Diversification does not assure a profit nor protect against loss.

This document was created for informational purposes only.