There is a very cool technique by which almost any decision can be made. Global corporations teach this technique to their staff, and many decisions are made just by this technique. And it can help your budget!
Do you think the technique can be applied only in large corporations and that it cannot be applied in real life? Yes, it can be applied, and it works especially well in personal (or family) finances!
We recommend applying it when you plan expenses and especially in situations where you or your family are trying to make spontaneous, unplanned purchases. This often happens during sales.
Recently, my spouse and I went to a sports hypermarket because we needed to make planned purchases before our trip. We usually buy everything online to save time, but here we needed to shop specifically in the store and needed a long fitting.
It turned out we hit a sale period and I had time to observe the shoppers. Many of them were making assorted purchases – from skis (of course, prepare your sled in summer) to new bicycle tires and mountain hiking clothing.
And it was clear that almost none of the buyers all this equipment and clothing will not be useful shortly, many bought on emotion because of the 50% discounts and hoped that they would take up these sports, since there is the right equipment and clothing.
If they had applied the “5 why” technique, they would have saved some of their money.
The basis of the technique
The technique is very easy and I’ll explain it to you with an example:
For example, you also happen to be on sale, and now you’re deciding whether you need a new smartphone now that you weren’t going to buy, but now it’s a great discount. For example, 50% off the regular price.
Let’s try running this idea through the “5 why”:
- Why do you want to buy this smartphone?
Because I want to surprise my colleagues;
- Why do you want to surprise your colleagues?
Because I want to draw attention to myself;
- Why do you want to draw attention to yourself?
Because I have nothing to surprise them yet, I feel insecure;
- Why do you feel insecure?
Because I want to realize myself in my profession;
- Why do you want to realize yourself in your profession?
Because I don’t like what I do;
What does a new smartphone have to do with it? It has to do with the profession you’re in. By the 5th “why?” the real problem always comes out.
Let’s take another example
For example, you found yourself at the same sports sale as me and discovered 50% off skates. For example, the skates cost 1500, but now they cost 7500, and thanks to coupons you can get them for 5800. Awesome skates for a fraction of the market price. Let’s run it through “5 why?”
- Why do you want to buy these skates?
Because I want to skate on them;
- Why do you want to skate on them?
To get back in shape;
- Why do you want to get back in shape?
To feel healthy and energetic;
On the 3rd why, I think we should wrap it up. If you know for sure that you will skate on these skates and this purchase will motivate you to get in shape and not just sit in the closet, you should make a positive decision. If you are not sure and you don’t have any extra money, then four or five reasons with weak answers will tell you that you should buy something else or it is best to put the money aside