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    Wednesday, September 24, 2008

    Is It Really Frugal?

    You've likely heard me talk about saving money vs saving time and what the difference is, as it's a somewhat common subject in my conversational repository. I can talk for hours on the benefits of making your own things when it comes to recycling, reusing, and saving cash, and I nearly always manage to work in that if you are spending more time making it yourself than what it would cost to go out and buy an item, it's not really a frugal option. But how do you figure out how much your time is worth?

    Well, my time is usually worth about $10/hr. It's a set rate based on everything I do in the home and in my business, what it would cost per hour to have somebody else do it for me, then divided by my waking hours each day.

    Everyone's value will be different, and for each activity there may be mitigating circumstances such as whether you like the activity or not, that can raise a particular activities value for you personally.

    For example, if it costs less money for supplies to make it yourself than buying it at the store, is it really less expensive in the long run? Let's see shall we?

    I'm going to use the laundry detergent I made a few years back as a good example, but with modern pricing.

    We've already stated that it costs less for the supplies than it does for the detergent straight across, so let's just estimate that to fill a 5 gallon bucket half-way with powdered detergent, it costs about $15 for the supplies. Not bad, considering that it would cost about $20 for even the cheapest chemical-filled detergent to fill that much space, and our detergent is higher quality, raising the store-bought price to nearly $40 for that much natural, eco-friendly, phosphate-free detergent with good cleaning power.

    So far we have a great deal!

    Now for the time factor. It takes me about 2 hours to grind down two bars of Fels Naptha by hand, or 10 minutes in the food processor, which ads the electrical cost of about a penny and a clean-up time of about 25 minutes to wash all the soap remains off of it so that it will be ready for food prep again. By hand, we have a cost of $20 just for grating, and $5 if we use the food processor.

    Already our make-it-yourself detergent is raising in price!

    Now let's take the time to open and dump all the boxes of goodies like borax, baking soda, and generic oxy-clean we've purchased for this little endeavor. That takes about 10 minutes on it's own, and these powders are heavy.

    We take about 12 minutes in the store to buy these ingredients, if we go to a store that carries them all instead of having to go to a couple of different stores to buy it (wasted gas money). It takes 2 minutes to just buy detergent. 10 minutes spent.

    Mixing takes yet more time, and to make sure that everything is mixed evenly, it takes about 20 minutes more, as shaking is by far the most effective method of mixing, and for that we have to snap the lid on tight, heft the thing, and shake for a good 5 minutes, then take the lid off and stir and repeat until it is good and mixed, or do the same thing without lifting and kick the sealed bucket around the house, chasing it, then stirring, again, repeating a few times to ensure a great mix.

    Every time we do the laundry, we have to spend two minutes opening and closing the bucket (we'd hate to get moisture in it and waste all our hard work, right?), and since 2.5 gallon bucket of detergent washes about 105 loads, that adds up quick to 205 minutes, or 3 1/2 hours just fiddling with the container on wash days.

    So we've spent nearly $60 on our detergent if we've made it by hand, or $45 if we've used the food processor to speed up the work.

    Best case scenario, we're spending about $5 over what it would cost for equally green detergent if we just bought it at the health food store. Not looking like such a good deal now, is it?

    Of course, if we get into the fact that this is mind-numbingly boring work, we bought all those separate things, all of which had their own packaging that we now have to find an eco-friendly way to dispose of, and that we now have a pickle bucket taking up a bunch of room in our laundry room instead of a smallish box, it gets even more ridiculous to make your own.

    We get some of our detergent for free, from sampling sites and the like, so our actual costs are even less than what we would spend if we went out and purchased all of our detergent at the store. Making our own detergent makes no sense, at least for our family.

    Of course, if you are taking your laundry to a laundry-mat and sit waiting for your clothes to finish, it might just be a valuable way to spend that time instead of just reading a book and waiting. See what I said about every circumstance being different?

    So you really need to consider all of the costs related to a money-saving activity in order to be able to properly decide if it will actually save you anything by doing it. Already doing some things by hand to save cash, but unsure if they are really saving you money? Decide how much you are worth per hour, then time yourself. You might just be surprised at how much your frugality is costing you.

    Thinking of a new project to save a little on the side? Involve the kids in the experiment, and use it as a life lesson and homeschooling opportunity. You'll be glad you did!

    Kacper Wrzesniewski from Poland, wrote a really good piece explaining your personal time's hourly value in his article "How much is your hour?". Go give it a read, it's good stuff.

    Are you doing something to lower costs that's not actually saving you anything?

    1 comment:

    Rambleman said...

    Good topic of conversation. Course *I* don't know what to say other than that, but still. We're just not really DIYers unless we HAVE to be.