Professor Perry Curtis - Wants and Needs

The most influential teacher of my adult life was Perry Curtis. You can check out his BIO <here>.

These are the two lessons he shared with me over 2 years ago and I will never forget them.


Lesson #1 Wants VS. Needs. 

We are all creatures bread into the microwave society of the 21st century. We want things now and have been convinced by media that these are things we need. We need an iPad, iPhone 4, and a BMW. We also need Diesel Jeans, Sperrys and Shox. We need our hair highlighted, we need the newest of everything and we need to eat at all of the cool places with our friends.

But it turns out these are not needs. These are Wants. Needs are a House; Transportation, not always being a car but could also be a bus pass, a bike or walking; Clothing, simple clothing of quality enough to present ourselves to the needed levels; food; water; and friendship.

It was a hard sell to our class that everything we want is not a need. Shoes are a need. 7 pairs is not filling that need. A car might be a need, but a $50,000 car isn't a need. Coffee might be a need, but Starbucks is not a need. Food is a need, but eating out is not a need. Jeans might be a need if you only have one pair, but $300 Diesel Jeans are not a need.

He illustrated this point to us using his daughter as an example. She wanted icecream that day and was begging to have some. She said, "But Daddy, I need some." He had to then explain to her that she wanted icecream because her life would not be any worse off if she didn't have icecream that day.

Opportunity Cost more closely defined what he was trying to teach us. Everything that we choose to spend our money on takes away something else we might have otherwise been able to buy.  If I buy the icecream that I want, I wont have enough money to pay the rent which is something that I need. If I eat out 5 times this week for $10, I wont have enough money to replace the tire on my car that gets me to work.

Lesson #2 Know Where You Spend Your Money.

Professor Curtis challenged us one day in class. He called it a quiz. "Without pulling out you wallet of your purse, how much cash and change do you have on your person, and in your bank accounts? How much to the penny? Question #2. Name every item you have purchase in the last week and how much it cost."

I thankfully can say I was one of the closest out of my class with my answers. I was within $.12 cents on my cash and within $22 on my bank accounts. Today, I find that to be awful.

His lesson was short and clear. How can you be in control of your spending if you don't know what you are buying and what you have and if you can't remember every item you purchased in the last week then your purchases weren't meaningful and definitely were not needs.

Our assignment that week was to write down every penny we spent, from a pack of gum, to a $500 car payment. Every penny we spent we had to write down. It was amazing and disgusting to see where we all spent our money and we didn't even know. I am proud to say I can account for every penny I have spent or earned in the past 24 months. This is how I took control of my finances.

We also did a Case Study later that week about how much little purchases can add up to. I will cover this in a later post. It will be entitled Starbucks for Bankruptcy.

Remember to fill your needs first and choose your wants wisely. I challenge you to account for every penny you spend for one week. It will change how you spend money for the rest of your life.