24 Apr 2025 Needs vs. Wants: The Tariff Tango

We recently had a conversation in the Beacon office that I imagine many people around the country are having: are there any purchases that you may speed up to avoid higher prices from tariffs? The general consensus was that no one was rushing to make a purchase decision that day, but everyone at least had it on their mind as they considered things they may purchase in the next year or so.

As of this writing, tariffs are still in place, but there is chatter of potentially slashing the steep tariffs on China. Though it seems there is a ‘wax on, wax off’ element to this, we will work with the assumption that prices of certain items we purchase may have elevated prices in the near future.

In light of the great toilet paper panic during Covid, the thought of speeding up purchases is likely more on people’s minds than it would have been otherwise. It isn’t just consumers though, even Apple rushed to ship 600 tons of iPhones before tariffs would be applied. There is certainly uncertainty about the ultimate impact on prices that current trade policies will have. With that in mind, how should we approach decision making in an uncertain time?

I think a general framework for thinking this through can be broken down into needs vs. wants. But even before sorting items into those buckets, it’s worth asking: Do I even need or want this in the first place?

Sometimes we feel pressured to buy something simply because it might cost more later. But if you weren’t planning to buy it anyway, does it really make sense? That’s like using a coupon on something you weren’t going to buy and thinking you saved money.

Needs vs. wants is a ‘tango’ in a lot of ways – it is a gray area that changes daily based on life circumstances and future expectations. Throw in tariffs that create an uncertain financial picture, and it can be hard to think through what is a need and what is a want. My wife, Megan, is the dancer in the family, but I know enough to know that a tango is characterized by patterned movement and then deliberate pauses. Similarly, this tariff tango will have us going through different movements and then reflecting on where we are.

It is easy to say that food and shelter fall under needs that must be spent. For many of us, a vehicle is also a need in our everyday life. At a certain point though, those needs can morph into wants. You need food and a car each day. You may want DoorDash food for each meal and to drive a higher-class car. The key is evaluating each decision within the context of your goals.

For items that fall into the need category, say replacing an aging car, it is certainly reasonable to think about moving forward with purchasing a new car sooner than later. Just this week, a coalition of U.S. auto industry groups warned that tariffs could raise prices. For items in the want category, maybe like a Louis Vuitton purse or Rolex, it could make sense to hold off on that purchase until there is more price stability.

All of this to say, I think in uncertain times it is appropriate to tango – deliberately pause to examine your situation and where you are before proceeding with the rhythms in your personal life. Spend time thinking through what is a need vs. a want vs. something that isn’t worth spending money on. At Beacon, we are always happy to talk with clients through big purchase decisions and help you think through your financial priorities. Let us know how we can help. 

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