“Honey, that’s not worth my time.”
My Dad and I had this conversation in high school, and at the time, I had no idea what he meant. How could saving money be a waste of time?
Now I get it. Traditional finance advice encourages you to waste your precious time in order to save pennies.
While you shouldn’t “waste” money unnecessarily, you also should be conscientious about how you’re spending your most precious and irreplaceable asset, your time. People will often clutch onto money as if there’s no way to get more, but they’ll squander their time. In reality, however, time is more valuable.
The simplest example: You could spend 5 hours per week trying to cut down your bills (clipping coupons, etc.), or 5 hours per week building a side hustle. While the side hustle may have a slow start, it’ll grow to a point at which you could earn substantially more than any amount you’d save.
Afford Anything reader Erika, for example, earns an extra $20,000 annually with her side hustle, which takes about 12 hours per week. That’s significantly more money than she could save, if she focused the same amount of time on coupon-clipping or bank-hopping.
With that said — here are three money-saving tips you should avoid.
Time-Waster #1: Coupons
The TV show “Extreme Couponing” glorifies it, but couponing can hog your energy and cause you to stockpile things you don’t need. This energy-draining activity requires:
- Gathering coupons
- Printing or clipping the coupons
- Filing them in your wallet
- Hunting for a specific brand in the aisles
- Double-checking that you’re buying the “right” quantity
- Shuffling through your coupon stack at the register
- Stockpiling a 6-month supply of salsa just because it’s on sale
- Weeding the expired coupons out of your wallet on a weekly basis
I’m exhausted just typing it. Not only does couponing eat your time, it commands your energy and attention — and you should take great care about how you direct your energy. Our minds can only juggle so much.
Total Time Clipping Coupons: 2-3 hours per week.
Number one, buy stuff that offers the best combination of price + quality. It’s penny-wise, pound-foolish to buy something that will break in 3-4 months.
Secondly, shop for basic household supplies from Amazon. They offer the best combination of rock-bottom prices (because of competitive online marketplace) and free 2-day shipping (if you get Amazon Prime, which is worth its weight in gold).
I use this to buy everything from kitchen sponges to dishsoap to shampoo, all at a fraction of what these items cost at my neighborhood store. Plus I save on gasoline, avoid the stress and time-commitment of finding a parking spot, and finish all my shopping in a fraction of the time.
Since I’ve started shopping on Amazon, I save about 5 to 10 percent off my former household bills, and it’s hassle-free: no expiration, no clipping coupons, and no stockpiling. You basically get a few bucks off every purchase with almost zero effort.
(Total time: 5 minutes).
Time Waster #2: Bank-Hopping
Too many people shuffle their money between banks because Bank #1 is offering a savings account with a 0.025 percent higher interest rate than Bank #2. This interest-rate-chasing requires keeping up-to-date on savings yields, opening and closing accounts, and reading the fine print to make sure you won’t be hit by some surprise fee which would wipe out your gain.
Total time: 2-4 hours per month to keep up-to-date, plus 1-3 hours per new account opened.
Ignore that stuff. Find one bank that you like and stick with it.
If you have $10,000 in a savings account earning one-half of one percent, you’ll earn $50 a year. If you DOUBLE it after hours of painstaking internet research, you’ll earn an extra $50 per year.
The time cost? Let’s be generous and assume you “strike gold” after just 1 hour of online research plus 2 hours to open the new account. For the rest of the year, you spend only 1 hour each month scanning the Web for a better deal. Total time = 14 hours per year, or $3.57 per hour.
You’re far better off starting a side business or simply enjoying time with your friends and family.
Time Waster #3: Some – But Not All – D.I.Y. Projects
Don’t get me wrong; sometimes it’s worth 30 minutes to install your own ceiling fan. But certain D.I.Y. jobs just aren’t worth our time. Do you want to spend your entire weekend buffing, sanding and staining your kitchen floors, or would you rather hire someone to do the job while you build your online business from your laptop?
The occasional DIY task is fine. But tackling too many DIY projects prevents you from making the “highest and best” use of your time — which is doing your BEST work.
Here’s my rule of thumb: a task that is quick and must be done repeatedly is worth learning. A complex or one-time task — like hard-coding a website — are not worth my time to learn, since I’ll never need to do it again.
There are exceptions, of course. Some one-time tasks are ultra expensive, so they’re worth learning. And some repetitive tasks are so cheap that they’re worth outsourcing.
That’s why Will says he’ll never change his car’s oil again.
To change your own oil, you must:
- Go to the store.
- Buy the oil/filter/pan.
- Wait for your car to cool once you return home.
- Lift your car with hydraulic jacks.
- Make sure it’s secure, so you don’t get crushed.
- Drain oil into a pan.
- Remove the filter (which is slippery and hard-to-turn).
- Pour in new oil and replace filter.
- Scrub your arms/hands/face, which are now covered in oil.
- Dispose of the used motor oil pan – probably requiring a second trip to the store.
Total Time: 1 – 2 hours plus $10 in supplies, including two trips to the store: one trip to buy the oil plus a second trip to properly dispose of your used oil.
Cost to outsource it: $20 with a coupon — yes, this is one coupon worth having.
Photo courtesy Krossbow.