Who do I base my characters on?

So, writers group tomorrow night. The topic for this meeting (suggested by my lovely wife - thanks hon!) is:

"Who do you base your characters on?"

A deliberately provocative question I know, because maybe you don't base your characters on anyone. Well that's fine, but I sure do.

I've figured out four different approaches that I take to creating characters.

1. I base them on other people

I find other people to be an interesting and ready source of character traits and motivations. They're everywhere! The plus side of this approach is that I'll never run out of characters.

The down sides are that I tend to feel guilty about 'stealing' from real people; or otherwise I feel afraid of offending friends/acquaintances/enemies when they realise that a character is based on them. The latter issue is not something I should worry about too much... I know that Hix based characters in Hopeless on some mutual friends, but I co-wrote the script with him and even I didn't realise that. And those people who did see themselves in the characters in Hopeless tended to be wrong. People are complex, so really as a writer you're unlikely to nail anyone so neatly and completely as to cause a blow.

2. I base them on me

In some ways, I know myself better than I know anyone else. And taking my own concerns and injecting them into characters is a good way to ensure that I'll be interested in them, even if no one else is. It gives the characters and the script a bit more dynamism if they're working out my issues. So the plus side of this approach is that it's personal. The down side is that it's personal.

3. I base them on other characters

Ideas are often not as fresh as they first seem, and characters can suffer from this problem along with other ideas. I often find that my first iterations of a character are not that original, and that I've probably snatched the idea of the character from some other story. So the plus side of this approach is that it's easy. The down side is it's lazy.

4. A mixture of all of the above.

This is actually what I do in reality, until I can't remember where the character came from. Once you fall in love with them, it doesn't matter anymore. That's when they feel real and as if they didn't come out of you at all!