Needs vs.
Wants
Why is it important to know the difference?
Understanding the difference between needs and wants is the foundation of smart money management. When you can tell the difference, it’s easier to prioritize the essentials, avoid overspending, and make sure your money goes toward what matters most. Learning this skill early helps you save, plan, and make better financial decisions for both today and the future.
Needs
Needs are the things we must have to live, grow, and stay healthy. These include food to eat, clothes to wear, a safe place to sleep, and things that help us learn or stay well. When we make smart money choices, it’s important to take care of our needs first—because they help us feel safe and strong.
Wants
Wants are the extra things we enjoy, but don’t need to survive. These could be toys, video games, candy, or the coolest new shoes. It’s okay to want things—everyone does! Learning the difference helps us save for fun without forgetting what we truly need.