It is a common concept, saving money makes you rich. If you drive five minutes out of your way for gas that is a few pennies cheaper, then you have earned a dollar that you wouldn’t have had otherwise.
Sounds smart right?
It does, until you realize that you saved the dollar but lost ten minutes. Ten minutes that could have otherwise been used for something more productive.
Time is Money.
Consider this. Minimum wage in Ontario is $10.25 per hour. If you work ten minutes you have made $1.71. This means that the ten minutes you spent driving to the other gas station actually lost you $0.71.
Most of us make more than minimum wage, which means that for many of us the amount of money lost is actually quite a bit higher. Even if you wouldn’t use those few minutes to work, there are much more valuable thins one can be doing; spending time with your family, relaxing, inventing a new product or service. Any and all of these are worth more than that one dollar would have been.
But it’s on sale!
Another way that this attitude of saving often backfires is during store sales. We have all seen those deals at grocery stores: 2 for $5, 3 for $10, buy on get the second half price. These sales usually don’t actually save you money, but rather make you spend more.
If you go to the store to buy one can of soup but see that you save 5 cents a can if you buy 5, then you actually just spent 5 times more than you meant to.
Robert Kiyosaki discusses this idea in his learning series “You Can Choose to Be Rich” that I got after taking one of his classes. I highly recommend his book “Rich Dad, Poor Dad”.
No comments:
Post a Comment