Needs Vs Wants Budgeting Challenge
Kate
MikeGoal
In this activity, learners will delve into the distinction between needs and wants in their daily lives, recognizing the impact of these distinctions on personal finances and budgets.
Materials
Instructions
Introduction
Briefly explain the concept of needs and wants in personal finances.
Emphasize that these definitions may vary based on individual circumstances and lifestyles.
Persona Assignment
Assign each participant or group (2-3 participants) a persona from the provided list (see Appendix A).
Each persona has a specific financial challenge, such as saving for a specific goal.
Expense Evaluation
Instruct learners to go through the list of monthly expenses for their assigned persona.
For each expense, learners must determine whether it is a "need" or a "want" based on the persona's situation.
Encourage learners to discuss and justify their decisions within their groups.
Budgeting Challenge
As part of the challenge, inform learners that they need to identify areas where the persona can cut costs based on their "wants" list.
Each persona also has a particular financial goal they are working towards that learners’ need to factor into their budgeting.
Group Sharing
Bring the groups back together to share their findings and the areas where they identified potential cost savings.
Debrief
Facilitate a debrief session using the debrief questions provided below.
Explore the challenges learners face in distinguishing between needs and wants.
Discuss surprise expenses and examples from learners’ own lives or communities.
Explore any disagreements within groups regarding whether specific expenses were categorized as needs or wants.
Background
Preparation
Familiarize yourself with the list of personas and adjust them to suit the characteristics of your cohort or community.
Select a suitable number of personas based on cohort size and group them accordingly.
For virtual cohorts, prepare a digital white board template for each persona.
Print copies of the personas for in person groups
Technology Considerations
Ensure participants have access to the digital white board if conducting the activity virtually. Provide guidance on using the platform if necessary.
Additional Context
Highlight the flexibility of needs and wants based on individual circumstances.
Emphasize that financial decisions are often subjective and can vary across different contexts.
Personal finances is personal.
Tips for Localization
Adjust personas to match the lifestyles and financial challenges prevalent in your cohort or community. Tailor the list of wants and needs accordingly.
Debrief Questions
Were there any challenges you encountered when trying to identify wants vs. needs?
Were there any expenses that surprised you during this activity? Can you share examples of surprise expenses in your own life or community? How do you navigate those?
Were there any expenses that your group disagreed on in terms of whether it was a want or a need?
If an expense was considered a need, how would you navigate fitting it into your budget?
Appendix A: Personas
Persona 1: Erica
Erica resides in Whitehorse, Yukon, and works as an administrative assistant for a local government office, earning an average monthly take home income of $3,900. She is a single, loves participating in community events, and values outdoor activities like hiking and fishing.
Monthly Expenses:
Rent (apartment): $1,400
Retirement savings: $400
Tenant Insurance: $55
Groceries: $700
Take out: $100
Utilities: $175
Internet and phone bill: $150
Transportation (maintenance and gas): $300
Gym membership: $60
Vacation: $100
Fishing supplies: $200
Clothing: $250
Financial Challenge: Erica is aiming to save an extra $250 per month to attend her niece’s graduation in Toronto.
Persona 2: Bob
Bob lives in Yellowknife and works as a Youth Worker making a monthly salary of $3300 after taxes. He has three kids, ages 7,9 and 11. Bob has a stay at home partner and they receive $2100 in child tax benefit every month.
Monthly Expenses
Mortgage payment: $1,800
Home Insurance: $190
Car Insurance: $100
Gas: $200
Netflix: $20
Internet: $150
Groceries: $900
Utilities: $400
Family Pool Pass: $125
Babysitter (twice a month): $120
Cleaner (twice a month): $120
Protein Powder Subscription: $70
Private swimming lessons for kids: $300
Clothing and personal items: $275
Friday night pizza nights: $240
Cell phone plan (for 2 adults and 2 oldest kids): $400
Financial Goal: Bob wants to save $700 per month to put towards his kids’ education fund. BONUS: If he saves an extra $200 a month he can also switch out his car.
Persona 3: Sami and Nora
Sami and Nora are a young couple living in Iqaluit, Nunavut. Sami works as a store clerk, earning $2,500 per month, while Nora is a part-time student and works at a local coffee shop, earning $1,200 per month. They eat a lot of free food from the coffee shop to save on grocery costs. Sami and Nora are both artists who enjoy spending time with friends and their dog Tidbit.
Monthly Expenses:
Rent (one-bedroom apartment): $1950
Utilities: $150
Groceries: $250
Dining out occasionally: $100
Internet and phone bill: $120
Pet Care: $150
Art supplies: $300
Loan repayment: $100
Health Insurance: $95
Bank Account Fees: $19
Emergency Fund: $100
Digital Subscriptions: $65
Board games: $85
Gifts: $100
Cigarettes: $125
Financial Goal: Sami and Nora aim to save an extra $500 per month for Nora’s next semester at school.
Persona 4: Margaret
Margaret is a retiree living in Inuvik, Northwest Territories. She spent the majority of her life working as a community health nurse, contributing to the well-being of her community. Now, in her early 70s, Margaret enjoys the slower pace of life in Inuvik and values the close-knit community.
Monthly Income: $4400 (pension, retirement savings and government benefits)
Monthly Expenses:
Rent (small apartment): $1475
Tenant Insurance: $45
Groceries: $400
Healthcare expenses: $525
Events and local activities: $125
Utilities: $100
Transportation (occasional taxi): $75
Book of the Month subscription: $75
Donations: $250
Gifts: $300
Postage: $150
RESP for grandchildren: $125
Travel: $500
Emergency fund: $250
Financial Goal: Margaret's goal is to save an extra $600 per month to have a financial cushion for unexpected expenses and to afford occasional travel to visit her grandchildren in other parts of the country, in addition to her annual trip to Florida.
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