💸 Needs vs. wants - How to make smart(er) spending choices

In partnership with

📢 A Message from our Sponsor

Man Who Called Nvidia at $1.10 Says Buy This Now...

• This company signed a major deal with Apple

• Nvidia has invested more in this one company than any othe

• And its tech is found in products from Samsung and Google

Click here for details.

Welcome Back, Future Funder!

Let’s tackle one of life’s trickiest lessons: separating needs from wants. For kids, it’s the age-old question:

Do I really need this, or is it just something I want?

Helping them learn to sort this out early builds smart money habits that will last a lifetime—and might even save them (and you!) from those checkout line temptations now and then.

Bon a petit! 🧑‍🍳

🍽️ Main Course: 💸 The ‘Needs vs. Wants’ Breakdown

Helping kids sort the true ‘gotta-have-it’ essentials from the ‘nice-to-have’ extras can feel like a balancing act.

But with some creative twists, these money lessons can become something they actually enjoy!

🎒 Needs vs. Wants – ‘Survival Kit’ vs. ‘Nice Extras’ 🏕

Here’s a simple trick for kids (and adults...)

In other words:

• Needs are the basics: things like regular clothes, food, school supplies—boring but essential.

• Wants are the extras: things like the sparkle-covered backpack or that new game they just have to try.

An experiment for the little ones…

Have kids make a list of their weekly ‘must-haves’ and ‘nice-to-haves.’ And don’t be surprised if a few of your own ‘wants’ sneak onto the list, too—everyone loves a treat now and then, especially this time of year 🎃

💵 Smart Spending – Treating Money Like an ‘Allowance Jar’ 🫙

Kids might think of money like that endless bag of Halloween candy—always there, always replenishing. But understanding that money isn’t an unlimited resource? That’s where the real lesson must be learned.

The ‘Candy Jar Method’ for Allowance

Give kids a weekly or monthly allowance, and challenge them to make it last for both their ‘needs’ and ‘wants.’ It’s simple:

Think of it as their own ‘allowance jar.’ This helps them see their money in a limited supply, just like a candy jar that only gets refilled on allowance day.

Pro Tip: Set Mini Goals 🎯

If there’s a bigger item they’ve been eyeing, encourage them to save up. They’ll start to see how saving now can mean a big reward later. This teaches them the value of patience and the satisfaction that comes with reaching a goal.

🔄 Handling ‘Impulse Buys’ (a.k.a. ‘But I Need It Right Now!’ Syndrome)

We’ve all been there: standing in the checkout line when your kid suddenly decides they must have the next greatest thing right now. Enter impulse control—a skill that, let’s be honest, even adults can find challenging!

Teaching kids to hit pause before a purchase is like adding a mental ‘pause button’ that can help prevent countless ‘are you sure?’ moments in the future.

Bonus Tip: Try the ‘24-Hour Think-It-Over’ Rule ⏳

If they’re convinced they want it, suggest they wait:

• For older kids: A full 24 hours gives them time to consider if it’s really worth it.

• For younger ones: Even a couple of hours can help cool off that initial excitement.

Chances are, the ‘gotta have it’ feeling will wear off a bit, and they’ll be better able to decide if it’s something they truly want!

🎁 Savor the Splurge - Yes, Wants Matter Too! 🎉

It’s not all about saving and scrimping! Once kids get the hang of budgeting, an occasional splurge isn’t just fun—it’s healthy. After all, treating yourself is part of life!

If they’ve been wise with their spending, let them enjoy that special treat guilt-free. It’s a way to feel the thrill of buying something just for fun—and knowing they earned it.

A Splurge Strategy: The ‘Treat Fund’ 🎉

Consider setting up a ‘treat fund’ for them. Here’s how it works:

• Set aside a small amount here and there, purely for fun.

• No saving or splitting required—just money they can spend however they want.

Even a modest treat fund can make all the difference. It lets them see that smart budgeting includes room for a little joy, too!

Key Insights:

• Needs vs. Wants Game: Encourage kids to list their ‘must-haves’ and ‘nice-to-haves’ to help them think more practically about what’s essential versus extra.

• Allowance Jar Method: Once their set amount is gone, it’s gone! This simple approach helps them grasp budgeting basics and learn to manage their funds.

• Hitting the Mental Pause Button: Teaching kids to wait before a purchase builds patience. A ‘cooling off’ period gives them a chance to decide if they really want something.

• Celebrating the Wins: Setting up a treat fund allows for guilt-free joy spending, balancing responsibility with a little fun.

In the end, helping kids make smart spending choices is about finding a balance. With practice and these simple tricks, they’ll learn to separate needs from wants—and feel great about their decisions!

Cheers to getting 1% better each week 🥂

P.S. – Got your own clever way of teaching needs vs. wants? Hit reply and let us know - we’d love to hear what’s working for you!

📢 A Message from CompareCredit

2 Cards Charging 0% Interest Until 2026

Paying down your credit card balance can be tough with the majority of your payment going to interest. Avoid interest charges for up to 18 months with these cards.

Learn More