In my last article, I talk about how I have been trying my best to consume only water.
As much as I try to limit myself to only drinking water, I find that I cannot possible only drink water for the rest of my life. What about the pleasure I get from drinking a cup of freshly squeezed orange juice? What about my favorite ‘Mango Plus’ smoothie from the nearby smoothie cart? And how could I not mention COFFEE!
I work at a 9-5 job that slowly drains my soul every passing day, which means I drink a lot of coffee. When I first started working in 2012, I didn’t touch the caffeinated stuff. However, over the years I slowly began to enjoy the smell and the perk coffee would bring to my day.
This eventually turned into a daily habit where I currently drink 1-2 cups of coffee every day. Besides the migraines I get when I don’t drink coffee, the worst part of this habit was how much I was spending on coffee!
Don’t get me wrong – we don’t need to STOP drinking coffee or stop the consumption of any good for that matter.
Instead, my point is that we need to find a way to capture the value we obtain from a good without paying retail prices for that good. This concept of buying something at a discount when you would have been willing to pay the full price is called your ‘consumer surplus‘.
For example, let’s say you are willing to buy a coffee for $2.50 in a normal situation but you happen to go to a breakfast cart that sells coffee for only $1.50. In this scenario, you buy the cup of coffee for $1.50 but would have been happy to pay $2.50 for the same cup.
The $1 difference is your consumer surplus.
So, instead of paying the typical $2.50 for a cup of coffee from Au Bon Pain or Starbucks, I have been making my own coffee! I have been making my own pour-over coffee in the comfort of my own home – costing me 15 cents for every $1.00 I used to spend.
I even bring my entire set up to work and make drip coffee in the break room at work!
Weird Ways I Capture My Consumer Surplus
Bringing my grinder, filter paper, ceramic filter, mug, kettle, and coffee brush into the office to make drip coffee is not the only weird thing I do.
I do plenty of weird things:
- Biking to work – saving the $116.50 I would spend on a monthly MTA metro card
- Bulk cooking 6-8 portions of food in a single night – saving $50+ compared to eating out/take away
- Never eating in a restaurant – saving %15 on every meal that is eaten outside the home
- Airbnb-ing out my 2nd bedroom – saving %70 on rent
- Buying groceries from Chinatown – saving %50 on grocery costs
- Canceling my gym membership – saving $25-$80 a month
- Getting free t-shirts from conventions and conferences – saving on clothing costs
- Cutting my own hair – saving $20-$40 a haircut
- Cutting my girlfriend’s hair – saving $40-$80 a haircut
- Dying my girlfriend’s hair – saving $40-80 a dye
- Re-wearing slightly dirty clothes – Saving $0.10 for each article of clothing for the price of laundry
- Bringing water/tea with me when I go out – Saving $1-$3 on drinks
- Buying games on sale – Saving %50+ on games (thank god for Steam bundle sales)
- Refusing to pay for microtransaction on mobile games – saving $1-$20
- Learning to code in C# from Youtube & Google – Saving $2k – $7k for a college level course
- Investing instead of consuming – saving far too much to calculate
- Doing my own basic plumbing work – saving $300+
These are just several ways that I have been saving money as they relate to my hobbies, habits, and goals. There is a unifying theme for each item in the list above, and that is that each item requires more patience, effort, and time than the respective consuming counterpart.
Produce Instead Of Consume
The point that I am trying to drive home is to produce instead of consume. Once you begin focusing on producing the items you want to consume instead of simply spending money on the items you want to consume, you will be saving more money than you could have ever imagined.
I will use the example of cutting hair – since we all have hair or had hair at one point. Instead of going to your barber and paying someone $20 to $100 for a haircut, you can buy a pair of clippers and scissors for less than $30 and cut your own hair.
Sure, you won’t cut it as well as a professional barber, but you will get better over time. It is surprisingly easy to cut male hair, but if you are a female – cutting your own hair is definitely achievable. If you are struggling while trying to cut your own hair, then take the time to learn! With the power of Youtube and Google, you can learn pretty much anything.
If you spend $20 a month for your haircut, then you could save $240+ every year just by doing it yourself! This is just one small step that all of us should take if we are to take control of our finances and become Financially Independent.
Now imagine you had your own list of 16 things you did to save money but still allowed yourself to enjoy the same lifestyle you had before – you would be saving a lot of money.
These small steps accumulate over time and will eventually make you think differently about how you spend your money. Take the time to learn how to produce something you would consume and capture your own consumer surplus!
If you found this article insightful, helpful, motivational, or just a slight bit entertaining, then please like, comment, subscribe, and SHARE!
Thanks for reading.