ClassX Video Lessons Financial Literacy—Needs and Wants | Learn about needs, wants, and opportunity costs
Have you ever had to choose between something you really want and something you need? Do you know how to tell the difference between a need and a want? Learning this can help you make smart choices with your money!
Needs are things you must have to live. These include food, water, a place to live, and clothes to keep you warm. Without these, it would be hard to survive.
Wants are things that are nice to have but you can live without them. These might be toys, games, or the latest cool sneakers your favorite athlete wears. They are fun, but not necessary for living.
Most of the time, when you make decisions about spending money, you are choosing between needs and wants. Understanding the difference is super important!
Imagine you have to decide between buying food or a new video game. The choice is easy: food is a need, so you choose that. But sometimes, you have to choose between two wants. This is where it gets interesting!
Opportunity cost is what you miss out on when you choose one thing over another. Let’s see how this works with an example.
Frankie wants to buy rollerblades that cost $85. She has saved $45 from mowing lawns and running a lemonade stand. Her grandma gave her $20 for her birthday, so now she has $65. The rollerblades will be on sale for $65 on Friday.
But on the same day, her best friend invites her to see a superhero movie with friends. The movie, popcorn, and soda will cost $20.
Frankie has to decide: should she buy the rollerblades or go to the movie? If she buys the rollerblades, she won’t have enough money for the movie. If she goes to the movie, she will miss the sale and won’t have enough for the rollerblades later.
Frankie needs to think about what is more important to her: the rollerblades or spending time with friends at the movie. She also needs to decide if she wants to spend all her money or save some.
These decisions are personal, and while they aren’t life-threatening, they help you learn what you value most.
If you had to choose between rollerblades or a fun time with friends, what would you pick and why? Next time you face a choice, try making a list of pros and cons to help you decide. Soon, you’ll be making smart money choices using your financial literacy skills!
We hope you enjoyed learning with us! Visit us at learnbrite.org for lots of free resources and fun learning tools for teachers and homeschoolers.
Needs vs. Wants Scavenger Hunt: Go on a scavenger hunt around your home or classroom to find examples of needs and wants. Make a list of at least three items you find for each category. Discuss with a friend or family member why each item is a need or a want. This will help you understand how to categorize things in your everyday life.
Opportunity Cost Role Play: With a partner, role-play a scenario where you have to make a choice between two wants. For example, pretend you have $10 and can either buy a toy or go to the ice cream shop. Discuss what you would choose and what the opportunity cost would be. This activity will help you practice thinking about the consequences of your choices.
Create a Needs and Wants Collage: Use old magazines or draw pictures to create a collage. On one side, paste or draw pictures of needs, and on the other side, paste or draw pictures of wants. Share your collage with the class and explain why you placed each item in its category. This will help you visually understand the difference between needs and wants.
Here’s a sanitized version of the provided YouTube transcript:
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**Literacy for Kids: Part One – Needs and Wants**
Have you ever had to decide between something you want and something you need? Do you know the difference between a need and a want?
Determining the difference can help us become better at practicing financial literacy. Let’s start with needs. A need is something that is a necessity, meaning you need it to survive, like food, water, shelter, and basic clothing. A want, on the other hand, is something that would be fun to have but you can live without, such as toys, games, or that new expensive pair of sneakers that your favorite athlete wears.
Most of the financial decisions you will make involve needs or wants, which is why understanding the difference is so important.
If you are deciding between whether you will eat today or buy a new video game, the decision probably seems simple: I’ll take the food, please. But sometimes you will have to choose between two or more wants. This is called an opportunity cost, which is the cost of missing out on the option you did not pick.
Let’s use an example: Frankie wants to buy a new pair of rollerblades that cost $85. She has earned $45 from mowing her neighbor’s lawn and running her own lemonade stand, and her grandmother gave her $20 for her birthday. She finds out that the rollerblades will go on sale for $65 for one day only on Friday. Later that day, Frankie’s best friend invites her to go see the latest superhero movie at the theater with some friends on the same Friday the rollerblades will be on sale. The movie, popcorn, and soda will cost around $20.
What should Frankie do: buy the rollerblades or go to the movie? If she chooses the rollerblades, she won’t have enough for the movie with her friends. On the other hand, if she chooses to go to the movie, her opportunity cost is the rollerblades not being on sale anymore, which means she will not have enough money to buy them.
Frankie must decide what works best for her: buying the rollerblades on sale or going to the movie with her friends. She also must decide if she wants to spend all $65 of her saved money or just part of it. These decisions are personal, and the consequences are not life-threatening; it’s about choosing which you value the most.
When you decide between rollerblades or friends, what would you choose and why? The next time you are deciding between two or more options, try making a list of pros and cons and go from there. Before you know it, you will be making financially responsible decisions using your financial literacy skills.
Hope you had fun learning with us! Visit us at learnbrite.org for thousands of free resources and turnkey solutions for teachers and homeschoolers.
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This version removes any unnecessary filler words and maintains the educational content while ensuring clarity and readability.
