Difference Between Needs And Wants With Examples

Understanding needs and wants is a cornerstone of personal finance and sound decision-making. In a world brimming with endless temptations and ever-changing desires, it becomes imperative to discern between what we truly require for sustenance and fulfillment and what merely allures us momentarily. This article looks into the difference between needs and wants, shedding light on the psychological, social, and economic aspects that influence our perceptions of these two distinct categories.

What Are Needs?

Needs are basic requirements or necessities that are essential for the survival of an individual. Needs include food, oxygen, water, housing, and clothing or heat in case one is living in extremely cold conditions. Failure to fulfill needs may cause a clear adverse outcome. It can lead to severe mental or physical illness. In some cases, inability to meet needs may also result to death.

Needs can be categorized into two groups, the objective or physical needs and the subjective needs. Objective or physical needs are those that are met through tangible things or those things which can be measured. Examples of such things include food, shelter and water. On the other hand, subjective needs are those that are often seen to satisfy our mental state or to ensure our mental state. Examples of these include self-esteem, a sense of security and love.

What You Need To Know About Needs

• Needs are items or things which an individual require to survive and live adequately.
• They are the necessities that are absolutely vital for human survival.
• Needs are limited in nature.
• They must be satisfied first before one thinks of satisfying the wants.
• Lack of or non-fulfillment of basic needs can result to death.
• Needs do not change, they remain constant throughout the life of the person.
• Needs are universal. Human needs are experienced by every human being without exception.
• Needs include food, oxygen, water, housing, and clothing or heat in case one is living in extremely cold conditions.
• Needs are generally categorized into two groups, the objective or physical needs and the subjective needs.

What Are Wants?

Wants are typically desires that people have or strive to satisfy by using goods and services. They are things one can do without but are desired to make life more comfortable. Example of wants include a big house, fancy food, branded clothes, new car, trip to a foreign country, big television, Rolex watch, a beautiful wife, handsome husband etc. Most often satisfying some wants may create a need for another related want. For instance acquiring a shoe may create a need for polish and socks, buying a car may require fuel or buying a phone may require buying airtime. Also, human wants change with factors such as time, age, income, geographical location, gender and social status.

Wants can be categorized into two main groups: comforts and luxuries.

• Comforts improve one’s living standards beyond the status of mere survival e.g furniture, medication, education, utensils, transport etc.
• Luxuries are goods that provide excessive comfort; they are generally for prestige e.g cars, watches, television etc.

What You Need To Know About Wants

• Wants are typically desires that people have or strive to satisfy.
• They are things one can do without but are desired to make life more comfortable.
• They are satisfied last after needs have been satisfied.
• Human wants are too many and varied to satisfy fully. They are insatiable.
• Resources needed for the satisfaction of human wants are never enough.
• Human wants change with factors such as time, age, income, geographical location, gender and social status.
• They can be categorized into comforts and luxuries.
• Wants are competitive in nature; they compete against each other for satisfaction using the limited goods and services.
• Satisfaction of some wants automatically leads to creation of other wants e.g when you purchase a car, you will automatically require fuel.
• Human wants are repetitive. After some wants have been satisfied once, they recur thereby creating the need to satisfy them again.
• Some wants are habitual, they result in formation of certain habits e.g use of certain brands of toothpaste, perfumes, body lotion and beverages based on habits.
• Wants vary in intensity. Different wants have different priority.

Also Read: Difference Between Dependent And Independent Demand

Difference Between Needs And Wants In Tabular Form