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Bartering to Save Money

"The propensity to truck, barter and exchange one thing for another is common to all men, and to be found in no other race of animals."

   - Adam Smith, Scottish philosopher and economist (1723-1790)

Google "bartering today's economy" to turn up three million web pages with those keywords. Here are a few articles that caught my eye:

"The economic slowdown has meant that many businesses are having to get creative to stay afloat. And an increasing number are turning to a mode of trade that's ancient: bartering." Read "Bartering Makes a Comeback Amid Tight Times" on the NPR website.

Bartering has been declared dead in the U.S. more than once since its heyday in the 17th and 18th centuries, when colonists routinely paid off debts with goods such as deerskin, beaver pelts and tobacco. We contend, however, that the practice is alive and well and serving an important function in today's economy." Read "Let's Make a Deal" on The Wall Street Journal online.

"Barter Economy may be regarded as the mother of all economic concepts prevalent today. It is the most primitive and very basic economic theory, which does not consider currency as a medium of exchange." Read "Barter Economy" on EconomyWatch

"Bartering, or the exchange of goods and services without money, has become a more common solution as family budgets tighten. In July, consumers listed nearly 142,000 ads on the barter section of Craigslist, a 96% increase from the year before, according to site statistics. Read "In Economic Downturn, More Turn to Barter" on SmartMoney.com

Cashing in on Your Creativity:
Two Ways to Look at It

by Barbara Brabec

"Cashing in on your creativity" is a phrase that fits our current economy and most everyone’s need today to both make and SAVE money.

Lately as I’ve been considering our deplorable economy and the financial difficulties of so many small business owners and families in general, I've been thinking about what it really means to be creative. As the author of several books for individuals in the arts & crafts industries, "cashing in on your creativity" is a phrase I've often used in connection with the idea of building a business around the creation and manufacture of handmade items and related services.

But "cashing in on your creativity" is also a phrase that fits our current economy and most everyone’s need today to both make and SAVE money. You may profit by offering a creative service or making something to sell, but you can also profit by doing something that saves you money. In essence, the more you can save, the less money you may need to squeak by each month until things get better financially.

You both profit and save whenever you make something for yourself that you don’t have to buy, or you make something as a gift that costs you nothing but time because you already have materials on hand. And “cashing in on your creativity” again conveys both the idea of making money from your creative talents and know-how and SAVING money because you possess that kind of know-how.

If you need something you must buy, you can "cash in" by being a savvy shopper and looking for ways to obtain what you want at lower cost. For example, last year when I could no longer tolerate the color of my old couch but couldn't find a new one with a design I liked as much, I decided to have it refurbished and upholstered. If I had gone with the first quote I got from a local upholsterer, this job would have cost me $2150. If I had gone with the second upholsterer, the job would have cost me $1820. But not being able to justify that much money, I kept looking and finally located an experienced upholsterer who had a full-time job as an upholsterer but also did upholstery as a part-time business after regular work hours. He was happy to get $800 for the upholstery work, was willing to let me supply the fabric, and guaranteed satisfaction. (He didn't even ask for a deposit.) I watched for a sale at Jo-Ann Fabrics and found exactly the upholstery material I wanted at a 50 percent discount, with the result being that my creativity in “shopping around” got me a new couch for just $1,050 that looks like it cost three times as much.

The Secret to “Cashing In”

You’re cashing in on your creativity and also saving money every time you give a handmade greeting card or gift; every time you can think of a new way to use your existing inventory of raw materials; every time you can fix something that’s broken.

You’re cashing in when you wait for something to go on sale before you buy it. And you’re also cashing in whenever you can find things you need at a garage sale, resale shop, or in someone’s public trash. (You might be surprised by the number of eBay sellers who regularly shop garage sales and pick up discards people put out on the street for garbage pickup every week. Once it’s on the street, in the public parkway, anyone can take it.)

Do It Yourself and Save Big Time

Many years ago, I read a book that described the hundreds of ways people save money, and how much more money we would need if we had to hire out all the things we were unable to do ourselves.

In these hard times, being creative puts you way ahead of most of the population who can’t do dozens of simple things that all creative people take for granted.

After I read the above-mentioned book and added up the value of all the creative and handyman things my husband and I were then doing ourselves, I realized that we were able to live comfortably on half the income many other couples needed because they couldn’t do those things themselves. So if you really want to feel good about your current financial situation and perhaps your shortage of cash now, add up the value of all the things you are doing that you don’t have to hire out, and then consider how you might live on even less income if you could learn to do a few things more.

You wouldn’t believe how many people can’t even sew on a button, take in a seam, or lower or raise a hemline. Anyone who knows how to cut hair is saving a fortune these days. If you can do any kind of repair work around the house, whether it’s replacing an electric outlet, fixing a leaky faucet, installing a new garbage disposal or sump pump, or making other minor household repairs, you are probably saving from $45-$75/hour by doing it yourself.

How-to books on every topic abound, and the purchase of one or two now might well save you hundreds or thousands of dollars over time. For example, I’ve cut my own hair for thirty years, and I also cut my husband’s hair for twenty years. (You only need to estimate the cash saved here to understand how just ONE creative skill can save you thousands of dollars over time.)

Bartering: Another Creative Money-Saving Option

Establishing friendships with other creative people or those with handyman skills can also be advantageous these days because then you can barter some services or products. In fact, bartering is making a big comeback in these tight economic times (see links at left), and many small businesses are joining barter exchanges.

There are tax considerations to think about when you regularly barter business products and services, but many of us can do simple barter exchanges without worrying about tax consequences. For example, I recently bartered with friends who did the following jobs for me in return for some books, CDs or tools I was planning to sell, or just a treat from my kitchen:

> Repaired a section of dry wall after a foundation leak was fixed
> Installed a new cartridge and needle in my LP player
> Installed a new garbage disposal
> Installed a new sump pump
> Cut down an evergreen bush that had grown into an ugly tree, and hauled all the branches out to the street for the annual shrub pickup by the city.  

Add up what it would have cost to pay service providers for all of the above and you’re talking more than a thousand dollars. (I almost fell over when the guy who sold me the sump pump—the same guy who fixed the foundation leak—said he would have to charge me $350 to install it. "Thanks," I said, "but I have a friend who will do it for a cake his wife won’t make for him.")

Now if that’s not thinking creatively, and cashing in accordingly, I don’t know what is.

If you want to feel better, just tally up all the money you’ve saved by being creative . . . or COULD save if you just changed the way you thought about "cashing in on your creativity."

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