The Financial Decision Flowchart

During one insomnia-filled night, the blogger behind No Credit Needed decided to make this flowchart to illustrate how they make their financial decisions. Pretty neat. I think there should be an extra step before the Make Purchase that says, “Am I Sure I Still Need And/Or Want This Item?” Large version inside.

[via No Credit Needed]


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  1. Franklin Comes Alive! says:

    Surely on of the most frequently posted links on this site, but what the hell…

  2. Franklin Comes Alive! says:

    You know, I should watch my links before I post them… My life for an edit button, commenter overlords! That wasn’t the original skit, but you get the idea.

    • BeeBoo says:

      @Franklin Comes Alive!: People make second posts correcting minor errors all the time. I think they are afraid of appearing ignorant but the reality is that a minor typo like you made isn’t even noticed by most people–our brains correct the error without us being conscious of it–or else they notice and don’t care. Of course, edit buttons should be mandatory for all websites that allow comments, even if it is only available for a few minutes after posting.

  3. aka_bigred says:

    I think it should be “Do I need the item” then “Do I have money to buy”, not “Have I researched prices. Research is pointless if you have no free cash!

  4. Bahnburner says:

    I’m missing the boxes about “fit into my long-term financial strategy?” and “defer to later date.”

  5. PinkBox says:

    If you don’t want or need the problem, why would you even consider buying in the first place?

    • DeleteThisAccount says:

      @PinkBox: I suppose its for those of us who think in binary and process everything in terms of consumerism. Hmm there’s a chewed up pencil for sale at this garage sale, Do I Want or Need it?

    • LoveNoelG says:

      @PinkBox: Because you didn’t really consider it. Have you really never bought something and then been like “I don’t even want that, why did I buy it?”.

      If not, good for you. Sometimes people need to really pause and think, do you want this item, or do you just want to buy something, anything?

  6. gnubian says:

    I research lots of things I don’t have money to buy .. researching just gives you better insight on what you are planning on purchasing.

    The real problem is that people tend to go directly from don’t have the money to buy -> make purchase anyway …

    See impending credit crisis, etc ..

  7. nsv says:

    For catalog shopping (which I do a lot of at Christmas,) I add an extra step: mark the page and set the catalog aside for a few days. If I look at the page a few days later and can’t remember what it was that I wanted, I toss the catalog.

  8. hi says:

    The yes and no boxes should be green and red. Other than that.. very nice.

    • hexychick says:

      @hi: I second that.

      I always thought this fell into the common sense category and that everyone just knew this stuff, but witnessing the housing market crash and everything else crash makes me realize just how many people actually DO need this chart. That’s just sad.

  9. BeeBoo says:

    Following that flowchart, I am to buy anything I need OR want.

    In reality, I don’t buy 99% of the things I want.

    • Franklin Comes Alive! says:


      Word. I *want* a 70″ Sony Bravia LCD ([]), and could theoretically afford it. Don’t think I’ll be buying one anytime soon though :-)

    • howie_in_az says:

      @BeeBoo: That’s where you’re messing up: if you can’t afford it, eventually the gubment will help you out!

      Let us be thankful we have commerce. Buy more. Buy more now. Buy. And be happy.

  10. RandomHookup says:

    Where’s the “Will my Wife Let Me Buy This” box?

    • BlondeGrlz says:

      @RandomHookup: You’re joking but in our house it replaces “do I need this item?” since almost all purchases are wants. Unless you count video games as “needs”.

  11. Rhayader says:

    Eh, seems sort of self-explanatory. The mind pretty much follows this process anyway, or at least knows it should.

  12. tcolberg says:

    One of the boxes should be “Is there something more important I can do with the money?”

  13. Real Cheese Flavor says:

    Yeah, there definitely needs to be “Delay Purchase” then a “Am I sure I still really need/want” box after the “Do I have the money?” one.

    I can’t think of how many times I’ve wanted something, had the money to buy it but put off buying it only to find out I really didn’t want it as much as I originally thought.

    Another alternative would be a “Could I use this money to go towards something else that I’m saving up for that’ll get me that much closer to the purchase price?” box, but that’s pretty wordy.

  14. ManfredTobias says:

    How about this for a last step:
    “Does the value this item will produce for me exceed the value of all other readily apparent potential uses of its cost?”

    Yeah, it’s a bit of a mouth full, and does complicate things a lot, but don’t you have to take opportunity cost into consideration at some point?

  15. balthisar says:

    I wanted to point out, wow, what an obvious, non-worthy flowchart. But, I’m not saying that. In fact, it would be valuable to stupid people with a minor change:

    Instead of, “Do I Have Money to Buy?” (which I understand to mean, “with which to buy,” since you’re not buying money but spending it), change it to, “Do I have money with which to buy that isn’t required for some more important purpose?”

    Most people always have money to buy something with; the trick is not to spend it merely because you have it.

    • pinkyracer says:


      exactly what I ask myself when faced with yet another pair of shoes I clearly don’t need but technically have the cash for. I found that looking at real estate on my last trip to NYC made shoes and clothes far less tempting than usual.

  16. mwwilk says:

    I have tried this exact logic with my wife. Does not work, especially when it comes to purses and shoes.

    I am trying hypnosis next (first on her, then on me if it fails).

  17. Dacker says:

    Between, “Do I want this Item/Yes” and “Have I researched prices” needs to be a discussion as to why I want something that I don’t need !

    By “I”, I’m actually talking about my wife, of course…!

  18. Scoobatz says:

    This flowchart doesn’t state any more than the following:

    Question 1: “Do I want or need this?”
    Question 2: “Can I pay in cash?”

    If yes to both, “Purchase Item”.

    I’d prefer to see a flowchart that focuses on the merits of making a purchase and truly understanding the differences between want and need. This flowchart doesn’t help me convince my wife not to spend $400 on a new Coach purse.

    • negitoro says:

      @Scoobatz: If anything, this flowchart encourages your wife to spend $400 on a Coach purse.

      After all, the charts says she followed a rational thought process to come to the decision.

  19. CrispinAbderus says:

    So just because I can afford something means I should buy it? That’s stupid.

    • stinerman says:


      Read more carefully. First you have to make sure that you’re paying the lowest price for something you don’t need.

      The “No” from “Do I need this item?” should go directly to “Do not make purchase” and the “Yes” should go to “Really?” about 5 or 6 times before it goes on to price checking.

  20. mugsywwiii says:

    Tht’s bt th stpdst nd mst slss flw chrt ‘v vr sn.

  21. hollywood2590 says:

    wsm. Thnks t ths cn nw prchs nythng nd shld hv th mny lyng rnd. ls, n cs dn’t hv th mny, shld jst strv t dth. Cs f y dn’t hv th mny, dth s clrly bttr thn sng crdt crd. Myb “th blggr” shld lrn th dffrnc btwn “wnt” nd “nd” bfr mkng n snn chrt.

  22. randomd00d says:

    This does seem like a rather dumb post. According to their flowchart, they buy everything they WANT.

    That kind of thinking is what gets people in trouble in the first place.

  23. lordargent says:

    Chart is missing the following steps.

    After “research prices” add “is it a ripoff”.

  24. gStein_*|bringing starpipe back|* says:

    do i need this item? NO -> do i want this item? YES will i USE this item… i often get caught up on that third one.