Wants vs. Needs

Now let's talk about wants and needs. Needs are really important items like water, protection, clothing
and food are some of the necessities in life. Wants are the luxuries that arent needed but you want them and you would probably have a really big wants list, a list that's bigger than the necessities list.

here is where we come to the scarce resources part. Everyone wants infinite things when there are finite resources, how is this possible?

Unlimited wants + limited resources = Scarcity

Resources are finite - they are only as valuable as they can be put to use by humans. If a resource is not used, then its value decreases over time until it becomes completely worthless (elements such as uranium ore).

It is a basic human trait to never be satisfied, but in the end, we are going to need to be satisfied.

There are many ways that people deal with scarcity, including trading with other individuals who have more resources than they do. The most common method is to adopt a mindset of scarcity by thinking, feeling and acting as if there are few options available or none at all. 

To decide between your wants and needs you can Categorise your priorities, the chart allows you to list your wants in one column and your needs in the other and then divide the columns in half and designate the top choices as a high priority and the bottom as low priority. From there, you can make informed decisions.

You end up with the following four categories:

  • High-priority needs
  • High-priority wants
  • Low-priority needs
  • Low-priority wants

Once you become better at differentiating between wants and needs, you'll probably see that you've been able to fulfil more of your desires over the years than you realized. And that can be a significant turning point.

When you find things that you want to buy or do that you currently can't afford, it becomes all too easy to focus on those things to the point of overlooking what you already have. Take time to reflect on all the ways that you've been fortunate and the needs you are able to meet every day.

When you get clarity about your wants and needs, you can determine what's most important and plan your budget to make those dreams a reality.

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