Crap – the stuff that fills our lives and somehow takes over, overwhelming and eventually burying the owner in a landslide of minutia – takes many forms.
Emotional crap, the burdens we absorb from others, or perhaps create in ourselves; obligatory crap, the duties and commitments we must uphold because of some important reason. (I leave you to figure out that reason, but obligations might be legal, social, educational or employment related.).
And then there’s physical crap. Not dog poop, but the stuff we buy in stores, and costs us big time in both time and money. You’re probably wondering – money, yeah, that makes sense, but time?
We’ll get to time later, but first, the money.
It costs you money to buy stuff (duh). The problem is the amount you paid is never quite what you paid for it. But wait, you’re saying, I paid $10.00 (or $11.30 if you’re in Ontario), so it’s worth $10.00, right?
You forgot to factor in the taxes applied to your own income, and how hard you had to work for that $10.00. Let’s keep it simple, and say you make $14.00 an hour, so that $10.00 purchase cost you just under an hour of your time. But, let’s say you’re employed full time, earn income for 40 hours a week, and your income is taxed at a rate of approximately 20%, and let’s say you get a fully paid vacation period, so you earn income for 52 weeks a year, for a grand total of $29,120, less income tax and leaving you with about $450 per week as take home. So that $450 divided by 40 hours means your actual take home wage is $11.25 an hour.
Given the sales tax rate, and our income taxes, that $10 item actually costs more than an hour of your time.
Do you actually need that item? Is your time actually worth it? How much enjoyment did you get for an hour out of your life?
(More on these later, but just remember that your hard earned dollars are just that – money that you’ve worked very hard to earn, and should not be thrown around lightly)
And the big picture gets even worse.
Depreciation creeps in, where products lose their value. Although we’re not talking about services here, put it does follow a similar train of thought – that $60 haircut, plus tax and tip, costs nearly $80 by the time you leave the shop, and with your own $14 hourly wage minus income tax costs over 7 hours, or nearly a full day, of work. More for highlights and colours;)
I am not against people in the service industry earning a decent wage, only that the consumer be cautious in spending. You want to get what you pay for, and often it’s the bright store lights and fancy displays, rather than the actual service provided.
But I digress. We’re talking depreciation. How things lose value, which is surprisingly fast.
Stuff depreciates as soon as you leave the store. The latest video game system you buy (at purchase price, plus tax, for your hard earned wage, minus tax) will resell the next day for only a portion of the price you paid, and will eventually stop working and transform into complete garbage. (I just dumped an old PlayStation3 into electronics recycling today.)
Things you buy depreciates into crap.
Your hard earned money does not do well when used to purchase crap. Unfortunately, crap can also be considered the stuff of life. I’m not saying go live under a rock, or don’t buy clothes, or cut your hair, but consider the true price of purchase. We all need food to eat, a method of transportation, and a place to live. A pizza every now and again is OK. You’re human, and we live in a society where goods and services are bought and sold, just consider the cost to yourself in terms of value for money.
And that stuff loses value fast.
Remember how we talked about time?
Time is money, they say.
We already talked about how your hourly wage (or portion of your salary) translates poorly into actual spending on stuff.
But stuff costs us time in ways we don’t consider.
Physical possessions cost us time in maintaining, organizing, cleaning, and just generally ‘taking care of things’ be it a motorcycle or designer wardrobe. If your time is worth something – a dollar amount, or as an investment in your own life, it’s probably better spent elsewhere. Physical crap costs us time and money by needing a larger house, or more storage, or perhaps special care services (think fancy rugs or painters to ‘freshen up’ your showcase home).
Somebody has to pay for it, and unless you have a generous benefactor, it’s probably you. Would you rather be working longer hours for a large home to keep your stuff in (given our tax and hourly wage discussion), or is it easier to not have all the stuff in the first place?
Now consider the time spent maintaining stuff – whether it’s picking toys up off the floor, or vacuuming the carpets in a large home – if your time is worth something, shouldn’t it be on things you actually value? Would you pay yourself to perform these tasks?
Cutting the lawn on a Saturday afternoon might be a necessary chore that you feel is an acceptable part of having a home with a yard, or a complete time waster that cuts into other aspects of your life. Choose the stuff you want to deal with wisely, so you get the best return on your dollar, so to speak, which is to say, once you meet your essential needs, invest your time and effort into things that bring you joy.
And, here’s a secret – the things that bring you joy are usually not objects, but people and hobbies in your life. Spend the time, and invest in yourself. And I really don’t mean through dollars (but it’s nice if you can put the money you save through not spending toward an RRSP) but invest in yourself through spending time on relationships, and interests, the things you truly value. At the end of it all, in discussing time and money, time is ultimately more valuable anyway. You only get one life. You may as well live it in a way that gives enjoyment, and without the ongoing burden of extraneous crap.
Questions? Concerns? Comments? Drop me a line email@example.com