Needs vs Wants Lesson Plan

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Direct

Instruction

Presentations

Class

Discussion

Technology-

Based Activity

Full Class

Activities

Worksheets

Small Group

Activities

Assessments

Individual

Activities

External

Resources

Needs vs Wants Lesson Plan

This lesson plan in an introduction to needs and wants,

and how we use that distinction to make decisions

throughout the day. The class activities aim to bridge the

gap between these basic concepts and how to integrate

them into the foundations of budgeting.

Overview

By the end of the lesson, students will:

Understand the difference between needs and wants.

Apply the concepts of money to their personal needs

and wants.

Understand how needs and wants relate to opportunity

cost in their everyday decisions.

Begin to explore the concepts of budgets and spending

plans.

Objectives

Lesson Plan Includes

Activity Summary

Vocabulary

A need is something that you cannot live without (i.e.

water, food, or fuel for warmth).

A want is something that is a luxury. Without it, you will

still manage to survive (i.e. tennis racket, new purse,

wrist watch, etc.).

An opportunity cost is the cost of choosing one thing

over another.

Standards

Spending and Saving

Standard 1. Develop a plan for spending and saving.

Standard 4. Apply consumer skills to spending and

saving decisions.

Financial Decision Making

Standard 1: Recognize the responsibilities associated

with personal financial decisions.

Standard 4: Make criterion-based financial decisions by

systematically considering alternatives and

consequences.

Standard 8: Use a personal financial plan.

This listing is based on the Jump$tart National Standards

for Personal Finance.

To see how this lesson aligns with other standards

(including for your state), visit:

https://www.personalfinancelab.com/standards-alignment/

Introduction

Time: 5 mins

PFL Budget Game

Time: 20 mins.

‘Budgeting’

Time: 9 mins.

‘Spending and Savings Plans’

Time: 18 mins .

Needs and Wants Worksheet

Time: 15 mins.

Post-It Discussion

Time: 15 mins.

List Guess

Time 5 mins .

Plane Wreck Survivors

Time: 30 mins.

Lost At Sea

Time: 30 mins.

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Introduction

Explain to students that today they will be learning about needs and wants. The foundation

of understanding budgeting and spending plans.

Ask the students to raise their hand and give you the definition of a want or a need.

Explain to them that:

A need is something that you cannot live without, i.e. water, food, or fuel for warmth.

A want is something that is a luxury. Without it, you will still manage to survive.

After students are introduced to the concepts of needs and wants, lessons start to build the

foundations of budgeting and spending plans.

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Independent Activities

Activities designed for students to learn independently, either in class or as homework.

Some activities include presentations if you prefer to use them for direct instruction instead

of independent study.

Independent Activities Include:

PersonalFinanceLab Budget Game.................................Time: 20 Minutes 1.

‘Budgeting’ Lesson..............……….…....................................Time: 9 Minutes 2.

‘Spending and Savings Plans’ Lesson………….…….......…Time: 18 Minutes3.

Needs vs Wants Worksheet...........................................…Time: 15 Minutes4.

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Type:

PersonalFinanceLab Budget Game1.

Have students complete 20 minutes of the PersonalFinanceLab.com Budget Game. For

each decision they make through the month, have them record their action, with a sentence

explaining why. Collect this sheet as an assessment.

Time: 20 Minutes

Required Resources: PersonalFinanceLab.com

site license & computer access.

Technology-Based Activity

Individual Activity/Homework

Class Discussion

Resource Links

Budget Game - PersonalFinanceLab

Getting Started

Either as a class, or individually, students can watch the How to Play the Budget Game.1.

If your students need more help, there are Tutorial Videos on every aspect of the

Budget Game.

The Budget Game can be accessed from the main menu, and their progress saves as

they go.

Discussion Questions

How did you prioritize which scenarios you would spend money on?

Do you think you spend more money on needs or wants?

What are some scenarios you didn’t face in the game but you face in real life?

Key Takeaways

Managing a personal budget involves controlling expenses through recognizing the

difference between needs and wants.

Focus on spending on needs like housing, utilities, clothing, healthy food.

Question the necessity of expensive clothes, extra TV channels, expensive coffee.

Avoid the temptation of buying things you don't need by unsubscribing from retailers'

emails or making a list of what you need before going to any store.

Value spending choices that improve quality of life, such as time with loved ones and

occasional luxuries.

Spending on unnecessary things can cost a significant amount of money and time.

Remember that it is your earned money and you decide if you want it in your bank

account or someone else's!

How to Play the Budget Game

Tutorial Video

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2. ‘Budgeting’ Lesson

Assign your students the ‘Budgeting’ lesson on PersonalFinanceLab.com. This lesson

explains the difference between needs and wants, and how it fits into building a personal

budget. Students will be required to complete the quiz at the end as an assessment. If used

as homework, follow up the next day with discussion questions.

Resource Links

Budgeting (personalfinancelab.com)

Presentation

All About Budgeting GoogleSlides Presentation

Discussion Questions

What do you understand by the term budget?1.

How might a budget help you with your financial goals?2.

How can you relate opportunity cost to budgets?3.

How would comparison shopping help with your budget?4.

If you Pay Yourself First, are you more likely to make smarter money decisions with the

money that is left and why?

Key Takeaways

A Budget is a tool that tracks income and expenses and helps set goals and make plans

for the future. It is personalized and based on individual goals.

Needs are necessary expenses, while Wants are items that are nonessential luxuries.

Fixed Expenses have a consistent cost each month, while Variable Expenses change

from month to month.

Financial Records should be gathered and analyzed to understand current spending

habits.

Income should be balanced against Expenses to determine if adjustments need to be

made.

Pay Yourself First means prioritizing your savings goals by setting aside money before

paying bills or expenses.

An Emergency Fund is savings set aside for unexpected expenses to avoid breaking your

budget, usually including 3-6 months worth of expenses.

Time: 9 Minutes

Type:

Required Resources: PersonalFinanceLab.com

site license & computer access.

Presentation

Assessment

Technology-Based Activity

Individual Activity/Homework

Class Discussion

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Contact: [email protected] (800) 786-8725

Assign your students the ‘Spending and Savings Plans’ lesson on PersonalFinanceLab.com.

This lesson continues to show how to plan out personal spending by identifying the

specifics of what students need to spend, what they should spend, and what they want to

spend, and how to include each in their personal plan. Students will be required to

complete the quiz at the end as an assessment. If used as homework, follow up with

discussion questions the next day.

Resource Links

Spending and Savings Plans (personalfinancelab.com)

Presentation

Spending Plans GoogleSlides Presentation

Discussion Questions

What is the difference between a budget and spending plan?1.

How does marketing affect your spending? Does it influence your wants or needs more?

How?

What is one thing that you could do to increase your savings other than stop spending

money

Suppose your friend got her first job and she wants to save for a new car. Explain how

having a spending plan would help her reach that goal.

Why is it important that you review your spending plan regularly?5.

What are three life events that could impact your spending plan? For each event,

explain how you would adjust your plan.

Explain the relationship between a spending plan and building wealth.7.

Key Takeaways

A Spending Plan is a plan on how you will be spending your money each month.

Your spending plan includes both your Fixed and Variable Expenses.

A budget has strict allowances while a spending plan allows for Discretionary Income.

Savings and investing can be part of your spending plan.

Marketing and life changes can influence your spending plan.

3. ‘Spending and Savings Plans’ Lesson

Time: 18 Minutes

Type:

Required Resources: PersonalFinanceLab.com

site license & computer access.

Presentation

Assessment

Technology-Based Activity

Individual Activity/Homework

Class Discussion

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Contact: [email protected] (800) 786-8725

Students will complete the worksheet at the end of this lesson plan that asks them to

classify items in their bedroom at home. They’ll analyze whether each item is a need or a

want, the level of its usage, and compare it to similar alternatives.

Resource

Instructions

Print the Needs and Wants Worksheet (pages 8-9).1.

Have the students complete the worksheet asking them to classify items in their

bedroom at home as wants or needs, along with the approximate cost.

Next, have them consider next-best alternatives to each item, and compare the cost of

those alternatives.

Finally, students are asked if, given the choice, would they buy the same items again or

were they a waste of money?

This activity begins to pair the concepts of “Needs vs Wants” with “Opportunity Cost”.5.

Collect the worksheets, and evaluate as an assessment.6.

Key Takeaways

Opportunity Cost refers to the potential value of the alternative option or choices that

are forgone when a decision is made.

Product Alternatives are different options or choices available for purchase that fulfill a

similar purpose or need.

The value of an item should not solely be based on its initial cost, but also on how often

it will be used and the benefits it provides.

4. Needs and Wants Worksheet

Time: 15 Minutes

Type:

Required Resources: Worksheet

Individual Activity/Homework

Worksheet

Needs and Wants Worksheet

Description

Cost

($)

Need

Want

Usage

(L,M,H)

Alternative

Cost

Value

for

Money

(Y or N)

TOTAL

Needs And Wants

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Write a list of 10 items that you have in your bedroom and complete the table below.

For each of the items:

Give the name/basic description of the item.

The approximate cost of the item.

Would you classify each item as a need or

want?

How often did you use the item when you first

purchased it? Was the usage low, medium or

high?

Are there any alternatives on the market to

what you bought?

What is the cost of the alternative?

Do you feel you got value for the money

with this purchase? (Yes or No)

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Needs And Wants

Which of these items would you definitely buy again? Explain why.

Which items do you think were a waste of money? Explain why you originally acquired

them.

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Contact: [email protected] (800) 786-8725

Full Class & Small Group Activities

Full Class Activities are designed for whole-class participation. These are best used along

with the direct instruction portion of the lesson.

Full Class Activities Include:

7. Post-It Discussion....................................Time: 15 Minutes

8. List Guess...................................................Time: 5 Minutes

Small Group Activities are designed for small groups of 3-4 students. These resources are

best used after full-class direct instruction and activities.

Small Group Activities Include:

5. Plane Wreck Survivors............................Time: 30 Minutes

6. Lost at Sea..................................................Time: 30 Minutes

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Contact: [email protected] (800) 786-8725

This activity puts students in the shoes of plane wreck survivors who must decide what

items they need to survive. As well as being a fun exercise, this will also give team

members the chance to see what type of role they naturally take within a group.

Resource Links

Stranded on a Mountain - the team building survival game

Discussion Questions

How did you work as a team to make the list?1.

Did any one have to sacrifice an item for the betterment of the team?2.

What was the one thing that everyone has on their list? (water) Would that be a need or

a want?

Instructions

Divide the class into small groups and provide each group with a worksheet.

First each student has five minutes to consider their own individual list of what the team

should have, without consulting with other members of the group.

Students should keep this list after presenting it briefly to the group.

Then students have 15 minutes as a group to discuss and agree on a combined list.

Each team nominates a spokesperson to present this new list to the class.

Afterwards, discuss with the class the benefits of discussion, teamwork, collective

expertise, group communication skills, etc.

5. Plane Wreck Survivors

Time: 30 Minutes

Type:

Required Resources: worksheet

Small Group Activity

Worksheet

External Resource

Class Discussion

Key Takeaways

Students learn the value of teamwork and collective expertise in achieving a common

goal.

Effective communication and compromise are essential skills for successful teamwork,

as demonstrated by the need to discuss and agree on a combined list of essential items.

Prioritizing needs over wants is crucial for survival, and this activity teaches students to

distinguish between essential items and luxury items in a challenging situation.

Provide a ‘lost at sea ranking chart’ to every student

Ask each student to take 10 minutes to decide their own rankings, and record the

choices in the left-hand Step 1 column.

Invite students to get into teams of 3/4.

Encourage the groups to discuss their individual choices and work together to agree on

a collaborative list.

Allow 20 minutes for this section.

Record the group rankings in the second column (team rankings).

The correct answers were suggested by the US Coastguard.

Display the ‘expert’ rankings on a PowerPoint presentation, whiteboard or

photocopy.

Compare student and group answers with the correct answers and determine a

score.

For each item, students should mark the number of points that their score differs from

the Coastguard ranking and then add up all the points.

Disregard plus or minus differences. The lower the total, the better your score.

As the groups work together, sharing thoughts and ideas, this should produce an

improved score over the individual results.

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This activity puts students in the shoes of shipwreck survivors who must decide a ranking

system of what items they need to survive. Since the students are ranking the items, they

must prioritize the needs or necessities over the wants or luxury items.

External Resource

Insight by Grahame Knox

Discussion Questions

Discuss with your group why the scores were different?1.

What changed their minds?2.

Were these changes enough to survive? 3.

Instructions

6. Lost at Sea

Time: 30 Minutes Required Resources: worksheet

Small Group Activity

Worksheet

External Resource

Class Discussion

Key Takeaways

Students will develop critical thinking skills, recognizing that the ability to adapt and

prioritize needs over wants is essential for overcoming challenges and achieving

success in uncertain situations.

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This class activity uses Post-It notes to get students to list their own needs and wants.

Then, during a class discussion students will learn there are an infinite possibility of wants,

but a limited set of needs that all people share.

Instructions

Give students 10 Post-It notes (5 of each color). 1.

Have the students write 5 wants one color and 5 needs on the other that they have in

their own life within the week.

Have the students bring the Post-It notes to the board and put wants on one side and

needs on the other side.

Once all the students have finished reading and putting Post-It notes on the board, read

a few of the needs and wants out loud.

Try to group by type or category (e.g. food, water, technology, leisure...) a.

Then follow-up by leading a class discussion.5.

7. Post-It Discussion

Discussion Questions

Why are specific items wants or needs? 1.

For example: water, make up, candy, cell phonea.

Is there an alternative for the wants or needs? 2.

Why are there so many items in the leisure category but only one option in the water

category?

Did anyone see an item that was either a want or a need that was different from what

they wrote?

What would be the effects if you did not have “Item X” (a want item) or “Item Y” (a need

item)?

Which is more important your wants or your needs? 6.

How different do you think the board would look if I did this activity with your parents? 7.

Would the wants be the same or different? What about the needs?a.

Ask them to put the definition of needs and wants into their own words.8.

Time: 15 Minutes Required Resources: · 10 Post-It notes (2

colors, 5 of each color) for every student

Full Class Activity

Class Discussion

Key Takeaway

Needs are essential requirements for human survival and well-being, while wants are

discretionary desires that can be fulfilled with varying levels of importance and priority.

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In this class activity students will be walking to the front or back of the class depending on

whether they think an item read aloud is a need or a want.

Instructions

Use the list of different wants and needs below.1.

Read one of the words out loud.2.

If the students think that it is a need, they walk to the front of the classroom.3.

If the students think it is a want, they walk to the back of the classroom.4.

Repeat this process with 7 to 10 words. 5.

After students decide if an item is a want or need have one student raise their hand and

explain why they chose their side.

8. List Guess

Time: 5 Minutes Required Resources: list of needs & wants

Full Class Activity

Class Discussion

Needs

Rent/mortgage

Electricity

Water

Heating

Groceries

Transportation

Car payment, gas, public transportation

Health insurance

Prescription medications

Basic clothing

Education expenses

Tuition, school supplies

Home insurance

Taxes

Eating out at restaurants

Movies

Concerts

Museum or gallery visits

Travel and vacations

High-end clothing and fashion

accessories

Electronics

Smartphones, tablets, gaming

consoles)

Cable/satellite TV subscriptions

Streaming services

Netflix, Hulu

Gym memberships

Home decor and improvements

Luxury items or experiences

Wants

Key Takeaway

Students develop a framework for evaluating and managing their own needs and wants

in a way that promotes overall well-being and financial responsibility.

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Conclude the lesson with a last class discussion that connects their needs and wants with

the concepts of budgeting and spending plans. Ideally have this discussion the day after

assigning one or more of the individual activities as homework.

Remind students that:

A need is something that you cannot live without (i.e. water, food, or fuel for warmth).

A want is something that is a luxury. Without it, you will still manage to survive. (i.e.

tennis racket, new purse, wrist watch, etc.).

This lesson is best followed by our lessons plans on Opportunity Cost and Budgeting.

Conclusion