Regifted: Can you afford to be so frugal?
As you can tell from some of my previous posts, I’ve been on a contrarian personal finance kick. The advice most often given on personal finance websites, blogs, and the like are what conventional wisdom says. Often that’s the best advice, but the problem with it is that it’s too tailored for the “general” person, not you. As I talked about before, everyone’s telling you to save, save, save. Honestly, that’s good advice, but what if you don’t need to save so much? In terms of happiness, can you afford to save as much as you do? Today I’m asking you, can you afford to be so frugal?
A couple days ago FMF (of Free Money Finance fame) posted the article, “Why I Pay More to go to a Car Dealership For Service Work.” To make a long story short, he’s willing to pay more for the time saving and enjoyable amenities that his car dealership has to offer. We’re not talking chump change either - $20 bucks more for oil change service. The “catch” is that his dealership offers free food, drinks, wireless internet and private work cubicles.
Still, $20 is $20 right? How could a frugal personal finance blogger justify this? By spending the extra $20 bucks, he’s not only gaining the free food, but he’s regaining the productive time that would have been lost.
Have you ever made the effort to think about how much time (and money) you’ve wasted trying to be frugal? So often we talk about the time value of money in terms of saving, but we rarely think about money value of time in spending!
How much time do you waste searching for the cheapest gas? How much time do you waste deal surfing on the internet? How much time do you waste getting your oil changed at a place that leaves you sitting on a chair watching Jerry Springer on TV when you could be sitting in a cubicle with free food, drinks, while your surf the internet doing work? Well, that one was tailored to FMF’s situation, but you get the point!
I challenge you to look at your activities and determine the value of the time lost in that activity as opposed to other alternatives. You may find that you’ve made the best decision, but chances are you might find that you’ve chosen the expensive frugal option!
(Note: This is the last of two “regifted” posts for a while. I’ve been in a seminar for the past two weeks, so I’ve been unable to post regularly!)
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January 19th, 2007 at 2:37 pm
I would only regift If I’M CERTAIN I CAN GET AWAY with it as in they don’t know it’s a re-gift.
January 21st, 2007 at 3:35 pm
When you make this argument, be careful about calculating your productivity time. Let’s say you have a job that pays $50/hr, so you could say, “My time is worth $50/hr.” The only flaw in this is that your free time isn’t worth $50/hr. In fact, you’re probably not making any money in your free time, but rather spending it in ways that you enjoy. If your hobby nets you some sort of income, then great, but unless it nets you $50/hr, your productivity isn’t the same. More likely than not, you probably won’t be making any money in your free time, so it comes down to how much you value your free time. Just don’t make the mistake of basing it on your wages.
January 22nd, 2007 at 1:19 am
Sometimes it pays to spend $20 for someone else to do the job, as long as you use that time saved to do something more productive.
Could you update the Growing Money URL on the link.
Thanks,
Smarty
http://www.growingmoneyblog.com
January 22nd, 2007 at 9:40 pm
My mechanic drives me to my office, and has really crappy free coffee, so I’d rather just go to the office. Time is not money, but time is valuable to me, so I don’t want to waste it, but it is actually more important than money really. Time lost, is lost, money lost can be regained. I’d only pay a premium if it meant I get to spend time doing something I love more, it’s that simple really.
–C8j
January 23rd, 2007 at 4:10 pm
I agree with big cajun man.
Once time is lost it cannot be regained. Time is precious to me