What is the Buyerarchy of needs?
You may be familiar with Maslow’s Hierarchy of needs; it’s a very famous pyramid that outlines how we humans operate in the world.
It lists what elements of our existence are most important to us to help define how it is we prioritise certain aspects of our lives.
Sarah Lazarovic is an illustrator based in Canada; she recently adapted Maslow’s hierarchy to explain how to best save money when buying things. It’s called the Buyerarchy of needs.
Her illustration helps us visualise and remember how we should approach the act of spending money.
As the world becomes more and more focused on disposable items and consumerism – I’m falling more in love with the concept of the Buyerarchy Of Needs.
Here is how you can apply the Buyerarchy of needs to your own spending habits.
#1. Use what you have
To truly save money, you must first attempt to ‘make do’ with what you already possess; it’s the starting point of the Buyerarchy of needs and the most logical way to avoid spending money.
Unfortunately for us, our brain is hardwired to receive a hit a dopamine each time we part with our money and make a purchase; it’s like a little hit of heroin to the central nervous system that makes us feel happy (temporarily) when we make a purchase. This stacks the odds against us consumers, making self-control and discipline no easy feat.
To be effective at using what you have, you must look to become meticulously organised. Take inventory of your household possessions to know exactly what you own. Practice minimalism (less is more) and learn to love ‘mending not ending’ by taking better care of your things.
Challenges such as ‘The 7 Day No New Food Challenge’ are the embodiment of ‘making do’ and a great way to practice using what you have when implementing the Buyerarchy of needs.
Borrowing is a great way to save money. So much of the world’s waste could be avoided if people simply shared their belongings more.
As humans, we have an inept desire to ‘own’ and ‘possess’ things; these are reflective of our physiological and safety needs (from the original Hierarchy of needs by Maslow) whereby we are trying to build our nest.
All too often we make purchases with positive intent, believing we will use the product again and again (to justify its value) – when in truth, we probably will only use it a few times. Start to discuss the concept of sharing your belongings with close friends and family. Get them onboard to the Buyerarchy of needs so that you can begin to build a network of like-minded money savers.
Swapping is a way to reduce your spending, save money and produce less waste. Critical to the Buyerarchy of needs, the art of ‘swapping’ is likely something you haven’t practised since Kindergarten.
Very similar to borrowing, learning to trade with people is a great way to reduce spending. Be it trading your time (to help them) in return for something of theirs that you want all the way to swapping games or movies once you’ve finished watching them.
Try joining local Facebook groups that focus on trades and swaps. Learn more about Freecycle.org and curate lists of items you want (alongside items you’d be willing to trade). Having this organised ahead of time will help you make swift and relevant trades.
A slightly ‘American’ term – thrifting refers to the act of buying goods (from second-hand stores) and selling goods (again, to second-hand stores). Perhaps a more Australian version of this concept is Vinnies.
Optimal ways to thrift include shopping at Vinnies, Lifeline or garage sales. When thrift shopping, buy only items you need – not want. You can even look to trade items, per the Buyerarchy of needs, albeit to the second-hand store itself.
Learning to make or repair items is a godsend for those trying to be frugal. Doing things yourself, or in this case – making things yourself will save you big money.
Look to create mini-projects at home, to help you achieve and make the things you would otherwise have purchased. This could mean buying your own supplies to make it yourself, in turn removing the cost of someone else’s time and markup when producing an item.
In it’s most simplistic example, you could have your children make you a birthday card – not buy one, saving yourself $5.
After exhausting all options of the Buyerarchy of needs, you come to the final option – buying the item. Once you decide you must buy the item, compare prices online and invest your personal time to find the biggest possible discount.
This is a bonus suggestion, courtesy of Savings Guide.
While not officially listed on the Buyerarchy of needs, selling items is a critical component I personally use.
Once you obtain an item, always be looking to sell the item the moment you no longer need it. Retrieving your money by selling unused (or no longer needed) items as fast as possible. It’s a clever way to recoup a component of your money, in turn subsidising the original purchase price even further.