Understanding needs versus wants isn’t always easy, especially for kids who don’t yet grasp the value of money. But showing them we all have spending priorities, is key to helping them become financially smart adults, able to manage their own finances. Here’s what they need to know.
Related: Financial literacy for kids, Budgeting for kids
What’s the difference between needs and wants?
The difference between needs and wants is that needs are things like food and clothing your child can’t live without. Wants, on the other hand, are toys and games your kids would like, but can survive without.
Explaining this essential difference is the foundation for helping your kids start thinking about money basics like budgeting, spending, saving and delaying gratification.
Your needs vs wants worksheets for kids
The concept of needs vs wants isn’t hard to understand, but it does require practice to remember. This is where our needs and wants worksheet comes in handy. No matter your child’s age, it’ll help them understand the difference. And explains why they can’t have everything they want.
Ready to get started? Download our free needs vs wants worksheet
How to use the needs vs wants worksheet for kids
Using the worksheet is also a great way for kids (and even adults) to think about the bigger decisions we make around money. Filling it out helps kids consider why needs have to be prioritized — what’s essential and what’s not.
For younger kids, the worksheet will help them understand why parents say no to things and how saving is a tool to help them work toward the items they want.
With teens, you can use the worksheet to talk about why it’s important to know how to prioritize needs using rent, bills, and student loans as examples. It also pays to widen the conversation to discuss saving, delaying gratification and budgeting.
What examples should I give when using the sheet?
The good news is that teaching your kids about needs versus wants can start at a very young age. For instance, it’s easy when you go shopping to handle their pester power by reminding them you don’t ‘need’ more LEGO at home. You do ‘need’ bread and milk, though. So that’s where the money has to go.
Start by filling out your own version of the worksheet to show them that needs versus wants have to be considered even when you’re an adult. For example,
|
Monthly Need |
$ |
Monthly Want |
$ |
|
Mortgage |
800 |
Clothes |
100 |
|
Food |
400 |
Takeouts |
100 |
|
Bills |
400 |
TV subscriptions |
60 |
Ask them if they’re surprised by anything on your wants list. If not, add more things they may not have recognized as wants (and maybe even taken for granted), like Netflix, certain foods, sports items, the car, or vacations..
Now ask them to think of at least ten things they, or you, have bought or spent money on recently. Record them in either the ‘needs’ or ‘wants’ column in the table, and then ask them several financial literacy questions to broaden the exercise.
Try:
-
Do you have more needs or wants listed? Why do you think that is?
-
Are you surprised at what falls under the needs or wants column?
-
Do you think anything is in the wrong column? If so, why?
-
Why do you need to prioritize needs?
-
How could you work towards getting the items you want?
-
What’s a good way to delay gratification?
How can GoHenry help me teach my child about wants and needs?
A GoHenry prepaid debit card for kids can help cement the lessons you teach your kids about needs vs wants by showing them how to use and save their allowance wisely. The app also features Money Missions which allows kids to earn points while watching videos and taking interactive quizzes on topics such as spending wisely, budgeting and investing.
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