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I met someone recently who bragged that she and her husband had saved hundreds of thousands of dollars over the years because they did all the work around their house themselves. That means yardwork, maintenance, the whole nine.
But did they really save money? What if they ran the numbers on that opportunity cost equation and found they actually lost money?
I’m thinking a lot about this right now, because I bought a new house recently, and there’s plenty of maintenance to be done. In fact, right now, there’s a guy out back fixing a busted pipe in my sprinkler system. And I’m feeling a bit guilty: Should I be out there fixing that thing? It doesn’t look that difficult – all it really amounts to is replacing a piece of broken plastic piping.
The case for outsourcing
The case for DIY
If opportunity cost is “the road not traveled,” then the cost of outsourcing is the improvement in my expertise and sense of satisfaction. The cost of DIY, on the other hand is all the time (and maybe money) that I could otherwise spend either making money or relaxing (hey, it’s the weekend).
Which means that the opportunity cost calculation of whether or not to outsource household chores becomes a very personal one. People calculate it when they decide whether or not to get groceries delivered, to have a gardener come to work on their yard, or to have their house cleaned by someone else. And a big factor in the decision is how much you enjoy doing those chores yourself. If you really, really hate it, and it takes forever, and you’d enjoy that time so much more doing something else productive or fulfilling or rewarding, then go ahead and outsource.
For a lot of people, of course, there is no question of doing an opportunity cost calculation: they simply don’t make enough money to even consider paying someone else to do something for them, so they have to do it themselves. Which means that if you’re in a position where you find yourself wondering about opportunity cost, it means you’re lucky. Even if it does mean doing some math.
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