Your Destination: For anyone to save money or know what to spend it on, you must distinguish between luxuries and necessities.
Travel Kit: Necessary items are things you need to have like food, water, clothes, dishes. Luxury items are things you should buy when you have excess income after paying for basic needs. See Necessity Versus Luxury and The Costs of Fashion handouts.
On the Path: If you have money available after you have purchased your necessary items, then you can consider buying something that you would like to have.
Step 1: Use your handout to Identify which products you use that are necessities or luxuries. Make a drawing of luxury items.
Step 2: Make a drawing of necessary items.
Step 3: Look at how advertisements in magazines emphasize needing items that are often not necessary. Understand the difference between luxury and necessary items by comparing your pictures with friends. Complete the handout.
Extend Your Journey: Make a list of products you want. Review your list of needs to see if anything can be removed. Will you still need these items in a few years or even a few months from now? Can any of your needs be swapped for a cheaper option?
Learn new vocabulary:
Substitute Goods – two alternative goods that could be used for the same purpose; for example, instead of an iPhone, buy an HTC phone.
Complementary Goods – goods that are used together with another product
Necessary goods – products needed for essential human existence or necessary to exist
Comfort or luxury goods – products or services that are not necessary but provide enjoyment
Resources and Visual Aids:
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