There are many skills we need to teach our kids to be successful in life. Quite a few of them relate to money – how to create a budget, how to save for the future, delayed gratification, how to know the value of a dollar. One of the most important life skills that relates to money is how to distinguish between needs and wants.
This skill can be taught even at a young age. I recently had the opportunity to teach my son’s Kindergarten class this concept while teaching them about money in honor of Financial Literacy Month (April for the curious).
I framed the discussion by explaining that it’s important to understand the difference between needs and wants because most of us have limited amounts of money and will need to decide what we spend our money on and that it is important to first pay for our needs and then prioritize our wants. I then defined the difference between the two by talking about needs as things we need to survive and be safe. The classic needs are water, food, clothing and shelter. The list can be expanded a bit if you add things that make you healthy like medicine, doctors and loving relationships. We then talked about everything else being a want, such as toys, junk food, expensive cars, fancy clothing and lots of money.
To make the lesson fun, we read Don’t Let the Pigeon Drive the Bus by Mo Willems. As we read it, I asked them questions like “Is driving the bus a want or need for the pigeon?” or “Is driving the big truck a need or a want?” Afterwards, I had them identify what things the pigeon might really need to survive (i.e., water, air, food, and a nest). Another game we played to drive this lesson home was to have them determine whether certain items I pulled out of a bag were needs or wants. Finally, there was an activity where they had to cut out pictures of different items and glue them onto a worksheet in two categories for needs and wants. The Kindergarten class seemed to really grasp the concepts and differences.
I’ve continued to work with my children on these concepts as we go about our daily life by using what are called “teachable moments”. For example, as I’m giving them breakfast in the morning, I’ll ask them “is this healthy breakfast a need or a want?” Or as I’m giving them Pirate Booty for snack I might ask “Is this a need or a want?”
Another fun activity you might do with your kids is to give them a stack of old magazines and tell them to cut out pictures of things that are needs and wants and then have them create two collages by pasting pictures of wants on one piece of paper and needs on another piece of paper.
The important thing is to introduce the concept and then consistently remind them of it as you go about your regular activities. Understanding the difference between needs and wants and being able to prioritize them is a critical life skill and will serve them well for the rest of their lives. This skill is particularly important to teach our kids growing up in the Bay Area and Marin, given the affluence that surrounds us. They will be surrounded by kids who say they “need” fancy clothes, cars and toys. It’s up to us as parents to teach them what true needs are and how to prioritize everything else.