Monday, November 06, 2006

Your Money or Your Time: A Frugal Debate

About 10 days ago, I requested help for a newspaper story about saving money or saving time. Here's the article that appeared in the Miami Herald.

In the tug-of-war between time and money, sometimes convenience wins out. And more importantly, sometimes costly shortcuts save money in the long run.

For example, I'm more likely to make a money-saving homemade pizza when I have a stock of pre-shredded mozzarella cheese on hand. My justification: Shredded cheese is more expensive than a block of cheese, but ultimately, I save more money by making my own pie.

Time pressures prompt many families and singles to eat out. But in that scenario, spending $6 to $10 for frozen dinners for a family of four ($1.50 to $2.50 per person) is cheaper than spending $40 at a restaurant, according to Terri Gault, founder of The an online shopping and coupon service.

It's a case-by-case judgment call, according to a recent Internet-based survey I created through ''How do you balance cost versus convenience,'' I asked bloggers and readers. An overwhelming majority (82 percent) of participants in my unscientific poll ''strike a balance'' between saving time and saving money.

Nine percent are willing to walk an extra mile to save a few bucks. But an equal amount of the respondents pay little attention to price tags during a time crunch.

''It's a constant battle. There are certainly times when everything goes out the window and anything that offers convenience at any price is worth it,'' wrote a personal finance blogger named 2million. ``I find balance by going the extra mile to save money as a normal practice. I don't even consider the convenience factor unless I'm in crisis mode.''

It's important to know the real-world value of your time, ''Rich Slick'' said. For example, he refuses to mow his own lawn. He feels his time is better spent earning money or playing with his kids.

''It would take me about two hours [on Saturday] to mow my lawn, trim the edges, pick up the grass/leaves and toss them in a bag. Two hours of my time equals $150. I can pay a lawn service company to do the exact same job (even better than I could do it) for $25. If on the other hand, I made $10/hour, then I'd probably mow the lawn myself,'' Rich Slick wrote.

Blogger Simplicity in Kansas says last-minute shopping for presents and other events can create a financial crunch. He avoids costly deadline spending by careful planning.

''I have found a little planning and patience, (waiting for sales), usually ends up saving me money. Keeping an active list of items I am looking for allows me to shop over time and find the best deal,'' Simplicity in Kansas wrote. For one-time, small-ticket savings of less than $10, the author of the popular website 1st Million at 33 ( opts for convenience. ''The higher the dollar amount, the more time I will take to decide and comparison-shop,'' the author wrote.

There were other great posts in the comment section.

From my email box:


The rational choice is to simply figure out the additional cost of convenience, usually in terms of higher price, versus the benefit. This works well for me most of the time. But we have to deal with the powerful force of emotions as well. If something really bothers you or makes you happy you might not be able to easily measure the impact that it has on your life.

A case in point for me is soda. I like diet soda. It is ridiculously expensive at fast-food joints and I could save a dollar a soda easily by pouring one at home in less than 20 seconds. That works out to $120 dollars an hour which is by most measures a great return, but I buy the fast-food sodas anyway. Why? I like the fountain experience. I like the ease. It is worth it for me even though a rational analysis would say “don’t do it”.



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