Needs vs. Wants
Needs: Something necessary for survival
Ex. Shelter, food, water, transportation, clothes, etc. |
|
Wants: Something desired, but not necessary
Ex. Latest shoes, IPhone, chocolate, new car, etc. |
- When spending money, it is important to know the difference between a need and a want. That way you won't over spend on your wants and not spend enough on your needs. If there is an imbalance when spending on needs and wants, you will waste your money on not important things.
- A value is a belief/practice about what is desirable and important to an individual. When spending money, also take in account the things you want to spend money on as a value. Ex. gym memberships, sports/ sports equipment, family vacations, etc.
- To successfully manage a budget, You have to understand the difference between needs and wants. You also have to understand when needs can turn into wants and vise versa. Ex. You need clothing, but you don't need the latest styles. or You want a laptop, but in college, you might need a laptop for classes