It is believed that writing is one of the oldest professions ever created since the early days of man. People who are engaged in this profession can earn good income too to sustain for their needs and wants. We even heard that some of the remarkable writers became millionaires. And they are regarded as entrepreneurs.
There are two types of entrepreneur:
- The Active Entrepreneurs – those who earn active income through employment, the practice of profession and through their own business. Their incomes come directly as a result of their own hard works, their skills, talents and time. And their incomes are to be spent only for their needs not for their wants.
- The Passive Entrepreneurs - those who make their money work to make more money. Their incomes are called passive income – those are investment incomes they earn from their assets or investments or both even when they do not work.
Passive Income has Two Main Purposes:
- To further increase their investments that will fund their future needs when they stop working or when they decide to stop earning active income.
- And to fund their periodic and personal wants in life.
Defining Needs and Wants
Want and need are understood as the overall concept of demand – as the desire to own anything, the ability to pay for it and the willingness to pay. I might say that this is true. There are times that we live beyond our means because we sometimes fail to know the difference between our wants and needs. There are times that we feel the fancy to buy for something that we think we need. It might be because of often pressure from friends, family and the dictates of visible society that brings this desire. And when we realize that we only want it - not really need it, we feel sad for what we had spent for.
Definition of Need and Want
A need is something that is necessary for a person to live a healthy life. Need can be objective and physical, such as food. In a broader sense, needs are the basic requirements for a person to be able to live and survive. These needs are food, clothing, and a house to live in. A want is something that is desired or something that a person would like to have.
Some Basic Needs
We need food to give energy to our body so we can work. We need clothes to wear at home, in school or in the office. We need a place to sleep in. Other basic needs include transportation, education, health protection, life insurance and some form of leisure times to balance our life existence. Without these needs make our lives more difficult and not worth living. We can imagine ourselves like those people who live in the streets and barely have nothing to eat, clean and decent clothes to wear and a house to take shelter in.
Need is for Survival and Want is for Luxury
To make it simple, based from the above definitions and descriptions, we can say that needs are the things needed for survival while wants are the things intended for luxury.
To expand them, I will say “I will build a house even if it will be made out from nipa leaves and bamboo trees where I can live and sleep in.” It signals about survival. And the money I will spend for building it should come from my active income.
But if I said “I will build a house and it should be made out of gold and silver where I can live and sleep in.” It signals about luxury I had desired. And the money I will spend for building it should come from my passive income.
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