One of the biggest ways to leak money is to spend your time in money-dense ways. The easiest way to explain it is to just show you a bunch of examples.
Spending eight hours at Disney World with the requisite food, drink, and souvenir purchases costs about $200. The cost per hour of this event is $25 per hour. This is a very money dense activity.
Spending eight hours reading a book you checked out from the library costs nothing at all. The cost here is $0 per hour.
Watching a DVD at home that you borrowed from a friend costs perhaps $0.20 in electricity ($0.08 per hour).
On the other hand, going out to a movie for two and a half hours costs you $10 for the ticket ($4 per hour) or, if you buy drinks and popcorn, $18 for the trip (about $7.50 per hour).
You can do this for virtually any activity with which you might spend your leisure time. From shopping for clothes to playing a video game, all such leisure activities have a cost per hour, and the lower you can make that cost per hour, the better off you’ll be.
But how can you actually use this idea?
What I did a while back is simply make a giant list of all of my favorite leisure activities. Taking a walk. Playing a board game. Reading a book. Playing a video game. Playing basketball. Playing with my kids. Working in the garden. Going to movies. Going to bookstores. Going to the library. The list was quite long.
Then, I figured up the approximate cost per hour of engaging in those activities.
Going to the movies was pretty expensive, as was going to the bookstore (because I rarely leave it without a book in hand). Playing a board game or a video game were usually pretty cheap, as the cost of each is prorated down because of the many times I’ve played each one ($1 per hour or, often, much less than that, and even that’s merely recovering a sunk cost). Other activities, like taking a walk or playing at the rec, were effectively free. Gardening arguably earns a little bit for each hour invested in it.
What happened was that when I had brainstormed this huge list of activities and actually figured out what they cost per hour, I began to spend more of my time on the lower cost activities (like taking a walk or yard work or reading a book or playing games) and less of my time on the more expensive things for the time invested (like going to movies).
It wasn’t even a conscious choice, really. Just by raising my awareness of the implicit cost of engaging in various activities I enjoy, I began to migrate towards the ones that drained my wallet at a slower rate.
Naturally, my entertainment and hobby budgets have dropped over the last year or so at no cost to my enjoyment of life at all. I just simply improved my awareness of the real cost of many of the things I enjoy and started making my choices of how to spend my scant free time from a more enlightened perspective.