Personal Finance 101: The Cost of Your Time

pf101When I first began to recover from debt, I sold off a large portion of my DVD collection. For a few items – box sets and the like – I sold them individually on eBay, but for quite a few of the single DVDs, I sold them at a used DVD store in one big lot.

Recently, when telling this story to an acquaintance, I was informed that I was “an idiot” for ever selling those DVDs in bulk, because I could get “way more” selling them individually on eBay. He walked away, assuming that I must have nothing of value worth saying.

I smiled, because I realized that this person puts no value whatsoever on his own time.

Let’s take a random DVD from my collection. If I list it on eBay, I might get a $12 bid, and the shipping and handling cost pays for itself. On the other hand, I could sell it at the used DVD shop and get $3 for it. Easy win for eBay, right?

Not so fast. First, I have to create the auction, which takes, say, ten minutes. Then, during the auction, I have two different questions about the DVD that I have to answer – three minutes each. After the auction is over, I have to nag the buyer a time or two to get payment – another five minutes. Then, when I finally do get paid, I spend ten minutes wrapping the DVD, then another ten minutes going to the post office and getting it weighed.

All in all, forty minutes of work in exchange for $9 – and that’s assuming the sale goes perfectly, the buyer doesn’t have a complaint, and the buyer doesn’t do some sort of payment revoking trick.

If I have a pile of 100 DVDs that I want to sell, I would have to invest that forty minutes for each DVD in the stack. That would be 66.7 hours of time invested to make $900 more than the other route – and, again, that’s assuming that all of the 100 buyers are happy with their purchase. For every purchaser that’s unhappy, you add more time and lose some income.

On the other hand, I take those DVDs to a used DVD store, sell them all in about half an hour, and there are no further concerns. I don’t have that extra $900, of course, but I do have 66 hours of my time and no concerns that people might revoke payments or I might have to make amends for other issues. It’s over with – I’m free to use the money and move on with my life.

Now, there are times when the eBay sale is worth it. Let’s say I’m selling a DVD box set. I might get $6 for it at the shop, or I can get $30 for it on eBay. For that one sale, the $24 difference is well worth my time investment of forty minutes.

To put it simply, money is not the only criterion that should be considered in a financial transaction in our lives. Time is often a major concern – and I see it overlooked time and time again.

This principle applies again and again throughout our lives. Here are three more recent examples from my own life.

Expensive cheese, valuable time A few days ago, I was making a pan of homemade chicken and spinach “white” lasagna. Unfortunately, I discovered I didn’t have enough ricotta cheese for the recipe – we had very little. I had two options – I could drive to the Fareway in Ankeny, about fifteen minutes away, or I could see what the tiny store in town had.

I stopped by the little store in town. They didn’t have any ricotta, but they did have low-fat cottage cheese at a very reasonable price, and for many recipes, cottage cheese is a fine substitute. I probably paid $1 more for the cottage cheese here than I would have if I had driven to Fareway, but I saved 20 minutes – a fair exchange.

$5 delivery We live in a very small town. Recently, we rented a van for a trip. The service offered delivery to our address for $5 – that would have saved us thirty minutes.

If it were not for the fact that we already had errands to run near the rental car place, we would have gladly used that service. $5 for an extra half an hour the day before a trip is an excellent deal.

Analysis paralysis I spent three months shopping for a netbook to replace my dying laptop, hoping to eventually find the best price. When I finally pulled the trigger, I only spent $10 more than the lowest price I had seen in many, many hours of searching.

One final note: I’m not suggesting that one should always substitute the fastest route for everything – in fact, that’s a bad policy on the whole. Instead, just be mindful that what you do does have a time cost (and often other costs), and then choose the option that’s truly the best value for you.

Good luck!

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  1. Nice post!

    People need to accept that time is more valuable and precious, then they can start making better decisions with it.

    When you think about it– people waste time more often than money . . .

  2. Johanna says:

    $9 for 40 minutes is $13.50 an hour. That’s less than the $30/hour rate that you were disparaging a while back, but still, a lot of people work for less than that. Willingness to work for $13.50 an hour does not imply that you put “no value whatsoever” on your time.

    And if you really were sending 100 DVDs through the mail, would you really need to get them all weighed separately? DVDs are all about the same size and the same weight, so once you know what it costs to send one, wouldn’t you know the right amount of postage to put on all the other packages? It seems to me that some of your time estimates are a little on the high side.

  3. Michael says:

    Good post, and don’t forget about the cost of gasoline. It would cost you much more than $1 or $5 to drive 20-30 minutes out of your way.

    However, $900 over 67 hours is still $12 per hour. You were in a desperate financial position, so how do you argue your time was worth more than that? Did you use that free time to launch The Simple Dollar?

  4. Miranda says:

    I agree that sometimes the time investment isn’t worth it. I know roughly how much my time is worth in dollar amounts (for my freelance work). I can usually easily figure the difference and decide whether something is worth the extra time to save a little money. And, of course, I also include the intangibles — like time with my son. Would I rather spend another 1/2 an hour saving $10, or would I rather play with my boy?

  5. My Journey says:

    Trent,

    WOW DOES THIS POST HIT HOME! I love the man, but wow my father is absolutely crazy. He just “discovered” Craig’s list and found that people just give away free fish (tropical) on it.

    Upon asking for a few details, I learned he was driving to the next state (NJ), paying for gas, tolls and TIME, to get a $20 fish. When I tried to explain your point EXACTLY to him, he couldn’t get it.

    You can’t help everyone!

  6. Joan says:

    One thing I’ll mention – as a side-business seller of books and DVDs – is that if you DO want to sell individually, Amazon is leaps and bounds over eBay. Among other things, you don’t pay a cent unless your item sells, and they give you a shipping credit; the listing process also can be done in about 4 clicks, and I would say one item start to finish (unless it’s rare) would take no more than 2 minutes.

    That said, 200 minutes is still valuable time, and you’ll find that some DVDs won’t go for a whole ton. It’s not for everyone. I’m presenting it as an option for those who want to sell items individually but don’t like the time/money eBay takes.

    Also, re: mailing, I don’t weigh any of my items. Our post office ships DVDs – which are super-light – for about a dollar first class. (Which means you profit off Amazon’s shipping credit, too, effectively reducing the percentage you have to pay to them, which isn’t huge anyway.)

    We just take a whole stack of envelopes in, and the post office lady works through them in moments.

    Regarding your situation, though, there’s another time/money factor – how SOON you get your money! In your case, you got guaranteed money instantly by taking those to a used-DVD store. I don’t know any way to do that selling online. It’s a much better method if you can wait for the cash.

  7. Rob says:

    So, how valuable is time, wasting it in front of a T.V.? How about all the people staring at their ipods playing with e-mail? Or people texting back and forth?. If my chores are done, my child is in bed, I would be happy sitting in front of Ebay making 6 dollars an hour. Its 6 dollars I didnt have an hour ago.

  8. Todd @ The Personal Finance Playbook says:

    You could also hire a personal assistant on Craigslist or an intern for the simple dollar, and give them the project of selling your DVDs for top dollar and pay them something like $10 per hour (or less, depending on the project and the skills of the candidate). For 65 hours, that would come out to $650. If they could garner you an extra $900, you end up with a positive $250. I hire people for services like this all the time. If there’s something that isn’t worth my time, I try to find someone that values their time differently. If you hired someone as an intern for the simple dollar and put them up to this task, the payment also becomes a business expense and reduces your taxable income – even though you made more money than you would have otherwise. Notwithstanding that idea, I basically agree with the premise of this post.

  9. Ben says:

    I agree with Rob there – “I do have 66 hours of my time” is only important if you have something to do with those 66 hours… if you’re un[der]employed, and there isn’t anything more valuable you could be doing with your time or doing these activities while watching TV or managing other emails, it’s less of a waste of time for the money. So I don’t think it’s cut & dried, but you’re certainly not a fool for saving your time vs. some extra money, if you have some better use for that time.

  10. Abby says:

    I was just thinking about this! Ladies Home Journal (probably not on your reading list, but anyway …) ran an article on ways to save money on lawncare, home maintenance, etc. One woman noted that a project took her ten hours and saved her $300. I can bill $30/hour for a freelance project, so that math really hit home.

    It doesn’t apply to selling books & CDs, but when it comes to DIY efforts, I think it is also important to consider the worst case scenario: What if you have to pay a professional to undertake the work you’ve finished? Or worse, to repair your DIY job AND re-do the whole thing? I’ve learned a lot about how to maintain our home over the years, but I think the most important part has been knowing when to pick up the phone and hire an expert.

  11. SteveJ says:

    The problem I always seem to have in this area is that the things that are a good cost/time trade are the things I want to do. It makes sense to pay someone $20 to mow and trim my yard. It saves me 2 hours. But I like to mow the grass. It doesn’t make sense to pay someone $500 to recover a hard drive when I have the tools to do it for free in 4 hours. But I don’t want to deal with it. So I end up mowing the grass and recovering the hard drive and complaining. Is this a common problem, you can’t delegate the things you don’t want to do and don’t want to delegate the things you can? I’d love to delegate grocery shopping to my son and I’ll make his bed :)

  12. Tordr says:

    Reminds me of a talk I found somewhere on the net. The speaker was talking about the wealth of networks and people where working on wikipedia for free.

    This person had an earlier discussion where he talked to someone who could not understand how people would give away their work for free. This someone was a television producer, how job it is to made making people pay to sit in front of a television watching his programs.

    So stop paying for your cable and rather demand that you getter paid for the time you sit in front of the television. (Or do some more productive with you time like blogging or write comments).

  13. Moviezzz says:

    I have to second what Joan said. While Ebay can be a waste of time (I haven’t sold anything there in years), Amazon is a terrific way to sell DVDs and books.

    Often I’ll go through my collection, find some titles I may not care about anymore, list them on a Saturday afternoon (making sure that the item is the lowest price listed) and, more often then not, no matter how obscure the title, by Monday morning I will have sold everything. I’ve never had a problem with a buyer, Amazon pays you directly and tells you who to send them to, and you get a heckuva lot more than selling them at local DVD store.

    You can list twenty or thirty titles in an hour. Sell them all for ten dollars and you are making $200 an hour. That is worth it.

  14. Enrique says:

    Hello Trent,

    I agree with one of the comments above. What else are you doing with those 66 hours of your life?

    I recently bought a truck for $1,000. Invested 14 hours of my time and about $450 on parts and repairs. I re-sold it for $3,500 in cash. Now with that I made a profit of $2,050 with and investment of $1,450 and 14 hours. Those 14 hours that I could had easily waste on facebook or myspace or else.
    So, my point is better to get that $900, at least you have money you didn’t have before. Just know how to allocate that time.

  15. Katie says:

    I have to echo statements about WHEN you get your cash. I have put books on Amazon and waited, waited, waited for them to sell (or not to sell!) and have sold books back to companies like AbeBooks and TextbookWheel. I did not get the best cash back at the latter two sites, but the money arrived via PayPal not that much later and I was able to ship for free (no upfront cost to me!). I used to love eBay, but in the past two weeks alone I have had two people win items and refuse to pay. I have to wait for eBay to resolve the situation, and meanwhile they collect fees (I may get reimbursed, but they took money for something I did not actually sell successfully) and I am annoyed that I left people eight days to get a small sum to me and they failed miserably. Quite aggravating, especially twice in a row (and for the most expensive things I sold this month).

  16. Gabe says:

    You’re assuming the worst case scenario for everything (having to nag each and every buyer, buyer complaints, low selling prices, buyer somehow “tricking” you and revoking payment, etc).

    Also, the first DVD sold is a time investment, because you DO need to initially determine the weight and shipping options. But, once you do that, you can obtain shipping materials all at once and reduce your time significantly, and re-use the same listing template on the website.

    So, even though the first one might take you 40 minutes, the rest might take you only 20 minutes each. So, that’s 40 + (20 * 99) = 33.66 hours. Round up to 34, and you’re looking at over $26 per hour.

    To be honest, it sounds like you’re just not really that familiar with selling things on eBay. So, on top of the cash (which you didn’t have before), you learned and mastered a new skill (selling things on eBay), which is worth additional value.

  17. Laura in Atlanta says:

    “If I have a pile of 100 DVDs that I want to sell, I would have to invest that forty minutes for each DVD in the stack.”

    Trent, good grief . . . listing items on ebay does not take NEARLY that much time. Yes, I get your overall argument and I do agree with it overall, but listing/monitoring/selling 100 DVDs does not requre 40 minutes each to do so.

    But yes, overall . . . nice argument. I use the same argument sort of in regards to ground travel sometimes in a Big City. Yes, taking my mother on the subway in the long run is much cheaper than taking a cab to a destination, but it is much more wear and tear on my mom to negotiate the stairs, the crowds, the wait time on taking the subway and the eventual walk to the actual destination than it is to just hop in a cab. . . its ‘cheaper’ for us to just hop in a cab that drops us off at the doorstep. The time/energy saved is worth the extra expense.

    ;-)

  18. Because I deal with a different age group, I tend to find that people overvalue their time when I talk to them. I’m a not-yet-employed college graduate now, so I have nothing but time and student loan payments. Sure, some activities will better help me to earn money to pay my loans faster, but just about any activity that earns/saves me money is worth the time right now. But some others in my situation don’t see it that way, they still over-pay for convenience. Their choice, I suppose, but I get a little tired of people trying to tell me that my time is worth more than what I think. Right now, things that bring in even 50 cents an hour are worth it, especially if they’ll lead to something great down the line.

  19. Steve says:

    I have thought about how to value time. One thing is that you can’t compare your wage to your time, because of tax – you need to at least compare your post-tax wage to your free time. Then, you have to consider whether you would equally work for the money or have your free time (i.e. would you work more than 40 hours for your same wage? or is each additional hour more of a burden to work? would you rather work 39 hours than 40 hours and take 1 hour less of pay? if so, then your free time value is probably larger)

    The main point is that people commonly equate their wage with their free time which is not the same, use post-tax numbers. If you earn $40/hour at a 25% tax bracket, use $30/hour as your comparison to working money.

  20. Nicole says:

    Ok, thank you for writing this.

    I was once unemployed for four months and while waiting for my new job to start, my parents said I could take things they didn’t want and sell them on eBay to earn some money. I think they were trying to help me out.

    By the time I took the photos, weighed the item (for shipping), described it, etc… It took so much time! I lost the notebook I kept track in (money made versus hours I put in) but I remember it worked out to something like $2 an hour.

    So anytime I see those “Make hundreds on eBay” commercials, I have to smirk. Because my time is worth at least minimum wage! :^)

  21. J.D. says:

    Trent, while I agree with your premise, your example here is terrible on so many levels.

    Your details are outrageous (“After the auction is over, I have to nag the buyer a time or two to get payment – another five minutes”) and you’re ignoring economies of scale. When you sell 10 DVDs or 100 DVDs on eBay, you’re not spending 40 minutes of work for each one. (40 minutes! Dude, that number is so off that it’s not even funny.) You batch process so that maybe it takes just a few hours for the entire lot. (Though, admittedly, 100 DVDs is quite a few!)

    Another premise seems wrong, too. You’re not going to get $12 for a DVD on eBay unless it’s something with low supply and high demand. You’re going to get $1 — or $3. That is the reason to sell them in bulk to a local store, not because it saves time. Even on the Amazon Marketplace, you’re only going to get $5 or so for a common DVD.

    To be honest, this post sounds like it was written by somebody who has never used eBay. I don’t know if that’s true with you (and I know you’re on the road and can’t provide a timely answer), but it’s just the impression that I get. I’m by no means an eBay expert, but I have sold many things there. It is time consuming — no question — but not to the extent you’re making it out to be here.

  22. Jeff says:

    “I smiled, because I realized that this person puts no value whatsoever on his own time.”

    It’s this kind of statement that results in the occasional accusation of your being “smug”. The value of a person’s time varies GREATLY, and that extra $9 may be worth it to them. You decided it wasn’t worth it for you. I would probably come to the same conclusion personally, but neither you or I can tell someone else what their value is!

  23. Kevin says:

    As usual, Trent’s example is way off, but his point is valid.

    And, as usual, the commenters all focus on the errors in his example, rather than the underlying point.

    Sometimes I really feel for Trent.

  24. Angie says:

    But when you have no ways to increase your income, then the value of your time doesn’t matter.

  25. Craig says:

    Sometimes you have to worry about if it’s worth it for your own time. That’s the issue with being frugal in the first place. You always have to worry about the time factor and if the reward is worth the time put in.

  26. Jessica says:

    I found the same thing applies to clothes. I have an 11 year old sister who is growing like a weed. My mother would give me her clothes to sell on ebay and I would also sell some things of my own from time to time. Eventually it got to be a huge time suck and I started to think the extra profit wasn’t worth it.

    Now I take most things to one of our local consignment shops. I may not get as much money for the stuff, but I get it out of the house in one trip rather than waiting for who knows how long for all of the items to be bought on ebay. As an added bonus, you get a 10% discount on what you buy if you use your store credit at this consignment shop so I will often wait to collect my money until the change of the season so I can pick up an item or two I may need at a discount. And I’ve still made really good money at the consignment shop.

    However if I have an item that still has tags on it or is a big designer name I will sell it on ebay. These items aren’t priced as high at my consignment shop as they can be on ebay. Shipping a few items isn’t too bad.

  27. Jen says:

    I couldn’t disagree more. In your example you were talking about when you were first trying to pay off debt. You would rather lose potential earnings because your time is too precious? If you were able to get a part-time job earning an hourly rate higher than you would make on ebay, then I could see your argument. However, if you are just sitting at home earning NOTHING; in this case, any earnings to help pay off debt is better than nothing.

    Let’s try another example using $900 earned for 66.7 hrs (or $13.49 per hour tax free) of work selling CD’s on ebay. Just over a week’s effort (assuming 40hrs per wk) or $900 tax free dollars could then be paid towards a $875 credit card balance with a 20%+ interest rate. Now does the ROI look a little more worth it?

    If is unfortunate that someone would rather sit on their butt doing nothing than trying to help their situation anyway they can. Since when are we “too good” to lower themselves to do whatever it takes to better our situation.

    Once someone is out of debt, they could then afford to be a little more selective of how valuable their time it. For a financial website, I think you are sending the wrong message to people.

  28. Sm4k says:

    Whenever I read you talking about this Trent, I find myself wondering if considering your ‘hourly pay’ for everything is really worth the effort put into it. For something like this, you would want to put a lot of though into it because like you said, there’s a substantial difference in the outcome depending on what you do. However, usually when I ask myself ‘is this really worth my time?’ the amount of time that takes for me to work out has eliminated any gain I could have saved taking the cheaper route.

    As the other comments have pointed out the example you list here is a bad one. As someone who has sold 40+ video games on eBay, I can tell you it’s not nearly that much work. Especially with Books, Games, and DVDs because eBay practically builds the listing for you once you type in the UPC. Include a picture or two and be honest about the condition of it, and I doubt you’ll get one question for every 10 listings. Buy a box of padded envelopes from somewhere like uline.com and you’ve eliminated ‘wrapping’ entirely. Make it so immediate payment is required, and you’ve eliminated the ‘nagging’ step. I’d say it took me an average of 6 minutes per item for each thing I sold, including the time it takes to walk from the house to the mailbox and back. Plug that into your equation and you get $90/hour, which is a big difference.

    The next time you find yourself in a position where you are faced with such a large difference, I’d recommend that you try it one way for a few, (as the first one is always the longest) and see if that’s worth your time. If it’s feeling like too much work, then switch.

  29. Gabe says:

    #17 Kevin:
    The example is used to emphasize and/or justify the underlying point, right?

    Well, if the example is far enough off, then the underlying point is likely to change.

  30. John says:

    As usual Trent, you tip all of the numbers in your favor to help you make a point. By the time you are finished with the math, you have lost all credibility on the subject. An average of forty minutes per DVD is probably two to three times more than it would actually take. Beware, bad assumptions like these significantly affect the credibility of your argument and of this blog.

  31. a conscience life says:

    “this person puts no value whatsoever on his own time”

    Wow. A bit harsh, perhaps? Maybe you could do him the courtesy that you felt he did not extent to you? Perhaps you can imagine that there are reasons why he said what he said? Let us examine just three (there are many more) reasons why he might wish to spend time on ebay individually selling dvds.

    1) He ENJOYS selling things on ebay. Who are you (or anyone, really) to judge him for what he chooses to do with his free time? Perhaps he really likes operating a small scale business. If that is the case, then he is spending his time as wisely as possible — doing something that gives him enjoyment. (and costs negative money too!) In this case, he actually values his time greatly and is using it to pursue a passion.

    2) He is in a position where the extra money actually matters to him. Perhaps he is having trouble making ends meet? Perhaps the extra $900 is not something that he can just dismiss? It is all well and good to place a high price on your time when you are financially sound, but when $900 is the difference between eating and not, then maybe it is a fine use of time to sell dvds individually on ebay.

    3) Perhaps he wants to take his wife/girlfriend/boyfriend/etc out on a killer vacation for an anniversary. Perhaps he is able to finance this by selling things individually on ebay. Perhaps it is easy to do this, because he can spend a few minutes a day on ebay and come up with the money to do this for someone he cares about. Perhaps that is a fine use of time? Maybe he does value it appropriately? In this case, he values that his time will enable him to do something really special for his partner. Maybe that is worth it?

    The point being that you have NO idea what this guy is thinking. You don’t know his situation or motivation. You claim that people need to consider things other than money (true), but then fail to grant that perhaps this guy is thinking about this. Basically, he made suggestion (which was true by the way, you CAN make more money selling individually) and then you assumed the worst about him — he doesn’t value his time.

    Such a harsh and obvious over-judgment is really disappointing to see.

  32. J says:

    One service we’ve used over and over again without complaint is grocery delivery. The charge is usually $5 for our order and it’s especially nice when we don’t have the 2 to 2.5 hours to spend on a trip to the store (which is a realistic estimate given taking two children, driving to the store, shopping, driving home and unpacking)

    I don’t think Trent’s estimate of forty minutes is that far off for the process of listing something, maintaining the listing, wrapping and addressing the CD/DVD and then going to and from the post office. Of course you could save time by batching up some of this stuff, but there is definitely more overhead than actually creating the auction, especially if the he needs to take his kids with him to the post office, that alone will add 10-20 minutes to the trip!

    Most people’s time estimation is horrible or only takes into account the best case scenario if everything goes right. A lot of the discussion here really underscores that, and people should think more about sources of possible delay when estimating time values, since delay is actually very common.

  33. 1WineDude says:

    Totally agree – this applies to nearly anything, but one needs to exercise self-discipline to ensure it doesn’t become an excuse for spending too much, etc.

    Case in point: I just spent thousands to “reboot” my lawn. Sod, trees, etc., etc. We tried for a few years and could NOT get things going on our own time. When I compared how much time it would take me to have a place where my daughter could safely play outside vs. what I would pay to do it quickly, there was no contest.

  34. KC says:

    First of all you need to invest in a simple scale and some individual stamps. It will pay for itself quite quickly. If you are selling on eBay you simply print the postage from paypal and slap it on there and drop it in the mailbox, but it helps to have a scale.

    Also you need to be selling media through amazon or half.com – you’ll save time and money.

  35. Andrew says:

    I agree with the guy that called you “an idiot”. I think you do to, actually, and somehow this lengthy post justifies your actions to you. You say “I smiled, because I realized that this person puts no value whatsoever on his own time.” How presumptuous and arrogant is that statement? It is almost as bad as calling someone an idiot. I also agree with everyone else who has said that your math is based on the worst possible scenario and skews the result in your favor. Critical thinking teaches us to be “charitable” to the other persons argument.

  36. Marc says:

    I’m not sure the eBay example is that far off. Someone unfamiliar with eBay (or computers) could spend a long time figuring it out for not a lot of money. Most transactions might go smoothly but just one or two could tie up a lot of time!

    The point is if your time is valuable, it’s worth seriously considering how it is used because seemingly good ideas can be inefficient.

  37. Sandy E. says:

    The issue isn’t even about X. It’s about whether or not you want to perform the steps necessary to save some money. I could tell that each step was distasteful to Trent. Time IS precious, and that’s not how he wanted to spend his. On the other hand, there are people who WOULD enjoy the steps, so would be willing to save some $. I would not. To each his own. He makes bread and makes his own laundry detergent and he enjoys those steps, so does it and saves some $. Me? No — I wouldn’t enjoy those steps. So it isn’t about X, but the issue becomes are you okay with spending your time, doing the steps necessary, to save some money? Most of us pay for oil changes, rather than doing that ourselves or learning how. The list goes on and on.

  38. Kevin M says:

    I’m thinking you probably should have left out the Ebay story and the snarky comment at the beginning – more folks would have gotten your point instead of focusing on the poor example. The last 6-8 paragraphs are really all you needed to say.

    Side note: If you really want to get rid of DVDs/books/etc – just sell them for the low price on Amazon. It takes literally a minute to list them and if you do enough at once, you can batch your shipments using the media rate at the post office.

  39. Bill says:

    Sorry Trent, I usually enjoy your posts but I think you are out to lunch on this one. First I take umbrage with your ebay time estimate- two or three questions about each DVD?? I have sold several other more complicated items with no questions at all. And as one of the previous commenters pointed out – do you need to weigh every DVD? Or even Wrap every DVD? I just slip mine into an Envelope and it’s done in about 5 seconds.
    I think you also have to be careful when you look at the cost of your time. Is it fair to compare to a real job wage such as $30hr? Not really because for most people it’s not a choice of ‘Should I work at my occupation for an extra hour’ or ‘should I put this DVD on eBay?’ It’s more like ‘should I put this DVD on Ebay or ‘watch another rerun of gilligan’s island.’ Probably not a fully fair comparison either but I digress. . .

  40. jc says:

    for the poster who recommended amazon.com over ebay for DVDs, I’ve been contemplating making such a switch, but ebay’s half.com is similarly simple. I do wonder if things would sell more quickly at amazon marketplace.

    i’ll also validate the idea that even one screw-up — on your part or theirs — can set you back one or more transactions.

  41. Heather K says:

    I didn’t see anyone mention Half.com, which is where I buy all of my books, CDs, DVDs, and videogames. When I’m done, I usually sell them back there for almost exactly what I paid. It is super-easy to list the items. I usually just search for it, then find the “Sell Similar Item” button, check the box that matches the quality and set the price below everyone else’s price. The buyer has to pay immediately, and you can print your USPS shipping label right at home and put it out in the mail. I would say it can take about 2 minutes to list – no pictures needed, no lengthy descriptions, no communications with buyer. Setting the lowest price means I usually wind up selling it pretty fast, and PayPal direct deposits my sales to my checking account twice a month.

  42. Dee says:

    Sigh. This argument about the value of time is constantly made, but, like Bill (#32) said you don’t always have the option of making your regular wage instead of whatever money-making measure you’re considering.

    At 5 p.m. on a Saturday, whether (most people) list that DVD or not, they will not make their regular wage. Might as well make some money.

  43. Mister E says:

    The general idea of this post I agree with, I also find eBay to be more hassle then it’s worth.

    But the example given is far enough off the mark to eclipse the underlying message. Forty minutes of combined time to execute a simple DVD sale is a ridiculous exaggeration.

    I also find the tone of your posts to be getting more and more smug and condescending and that’s not good.

  44. russds says:

    Agree with #32 and #33. You can’t always get your maximum desired value for each hour. I say get an idea of your hourly value during different times of the day/week (for us stable career folk), then you can adequately measure what your hour is worth at different times of the day/week.

  45. Jean says:

    So did you make it to the Rangers game? (Yesterday’s post) Inquiring minds want to know

  46. Shevy says:

    As much as I agree that Trent overstated a worst case scenario when he estimated how long it would take him to handle each DVD, I think he may also have misrepresented how much money he could reasonably hope to get for each one so maybe that’s a wash.

    As for me, I have items I’ve wanted to put on eBay for well over a year and they’re still sitting here, not making me any money. I’d be far better off to take them somewhere, assuming that there was some place that would buy them outright or sell them on consignment (these are collectables and other miscellaneous kinds of items as opposed to straightforward DVDs).

    If I continue to wait until I overcome the inertia and do all the things I have to do in order to be able to list them, I could be waiting a long, long time. Every one of those steps (learning how to use eBay, opening a PayPal account, taking pictures, uploading them, ad infinitum) is overwhelming to me and the promise of money at the end really doesn’t cut it.

  47. Leslie says:

    Totally agree with Dee in #33. The value of time argument is valid in many ways but it drives me crazy when people say things like “I paid someone to do xyz because I can make more per hour doing my work so it is cheaper to pay someone else to do it”. Last time I checked, no one works all the time so the chances are that at least some of the time (a lot of the time?) that is just a rationalization to pay someone to do something that you don’t want to do. Nothing wrong with paying people to do jobs that you find distasteful but this particular rationalization is often not valid.

  48. Kris says:

    For your time vs money argument to really hold any water, you would have to assume you had something more productive to do with the time you saved. Using your ebay example, if you had something that was going to make you or save you more than $13.40 an hour during that 66 hours then I would agree with you. However, if you were less productive then you cost yourself money. If you decided to watch some reality crap tv during that 66 hours, then you just paid $13.40 an hour to watch it.

    I do understand your point, but it does depend on productivity and actually having something more productive to do. I often find people who use the time vs money argument are doing so to justify laziness.

  49. SmartSecurityPeople.com says:

    I read your article and quickly identified with it because I have a father-in-law that chooses to go the route of selling every CD and DVD individually on eBay. I never understood it because it takes him a lot of time to recoup very little revenue.

    However, what I realized is that he considers it a hobby and he really enjoys the transactions and the communication with customers from all across the world. To him, it is more than the revenue, it is the sense of purpose that he gets from doing it.

    Oh Yeah… I forgot to add that he scours garage sales and thrift shops for the best “values” on used CD’s and DVD’s that he believes are under priced and could get him a buck or two on eBay. What can I say.. he loves what he does.

  50. SteveJ says:

    I think the time vs money argument is usually an attempt to sound logical and simplify a complicated situation. No matter how you spin it, you’re saying I find this activity to be worth more of my time than another. So you could look at it as my time is worth $30/hr, or that activity could be replaced with reading a book to a child, playing the new video game, or reading the simple dollar. In short, we’re trying to put a value on our time and money is a simple metaphor. I could equate everything to how many bricks I could lay in that time, but money seems to be a tad more universal. Writing this comment was worth less than one brick.

  51. Jeremy says:

    It’s impossible to be productive for 16 hours a day. So, you might as well do something that will make you a bit of money in your down-time (rather than watching TV).

  52. almost there says:

    I am retired, get paid to breathe. When I stop breathing no more retirement. So is my time worth $X/per hour? It is whatever I make of it. Now, I am going in to stand a 12 hour night shift because in addition to the money for breathing I get money for work. Like the other comments I think that the value of time is overstated. I would simplify the ebay sales by investing in a postal scale, digital, buy bubble mailers in bulk to keep cost down and ship via USPS media mail or Priority mail. Trent can do all that at home and save time going to post office. I took my cds to a place that offered 1 cd credit for everyone I turned in. Pre ebay days. Should have sold on ebay and made a lot more than those businesses that take advantage of you for your not wanting the hassle of selling it yourself.

  53. Damester says:

    I happen to agree with Trent’s overall premise about looking at ANYTHING you do in terms of the “cost” of your time spent. Because your time is valuable whether or not you are being paid a sum for it.

    OK, so maybe his examples don’t work for some of you.

    And if you are totally unemployed and have nothing else to do with your time (Really? Housework, kids? Errands, repairs??? Looking for work? Interviews?), then maybe you could waste hours and hours, if not days, selling stuff hither, thither and yon.

    I’ve seen people do this. Yea. they make a few bucks. (And for whatever reason, for most people, we’re talking about a not so great amount of money)

    But what else could you have been doing with that time? TOo many people get caught up in the sell-off when there is no real payoff. It’s a great time-waster for many people. And if you look closely, an excuse NOT to be doing something else.

    Each person sets the value on their time, based on their own life.

    What is a “waste” for one is significant to another.

    So all of us here are expressing our opinions, as is Trent, about the value of our time and what we choose to do with it.

    One point I wanted to make here was about how people are always looking for the “cheapest” airfares, for travel. People often waste hours, days, etc. to save $10 or $20. It’s just crazy.

    If you educate yourself on how to stay on top of the deals, you don’t have to do that.

    If you know when to buy and where to look for discounts, you don’t need to waste time.

    There are plenty of online sites, resources that can flag the discounts for you. It’s only people who know nothing about travel who waste time looking for fares that don’t exist.

    (If you haven’t flown in years, for example, or are familiar with prices on a particular route, you’re probably thinking in terms of what you used to pay or have no idea what the rates and ranges are NOW. Educate yourself.

  54. Mia says:

    I have to agree with the point of this post. I recently ran into the same thing a while back when I was selling off some old books. I had a ton to get rid of – now I could have very easily sold them 1 at time and maybe made more money, but I found that selling them in bulk made the offer more appealing for the buyer and it saved me a ton of time. The constant trips back and forth to the post office alone is worth it.

  55. Charlie says:

    Couldn’t agree more, Trent. The hope is that people at least begin to question whether an action to save or spend a few dollars is worth it, when weighed with the factors of time and convenience. Everyone’s answers to the same situations will likely differ. For myself, a new father of triplets, paying for convenience is something I am more willing to do than when it was just my wife and myself.

  56. LDH says:

    I wonder this about people who have garage sales. I can’t imagine spending a Thursday night pricing my junk for $2 each and then sitting out all Friday and Saturday trying to sell it for 75 cents after people talk me down. But people do this all the time instead of just being rid of the stuff at goodwill.

    This is how I justify shipping on many purchases. I just paid $11 in shipping on something, but I don’t have to get the car, fight traffic, and browse around a store.

    Your note regarding the laptop purchase was interesting…sometimes when I read other posts about research I am amazed that the amount of time you spend was worthwhile. Obviously, you can turn your research into a post, usually, so it’s probably ok for you, but I think most of us would run into your laptop problem for many of our purchases: it simply wouldn’t be worth it to get the BEST price, just check the AVERAGE price and make sure we’re not getting too severely gouged.

  57. LMJ says:

    I’m just starting to embrace this concept. It makes so much sense. I’ve been stressed for months about the yard sale “I’m going to have, and make $200″, but I can just unload all of the stress for free tomorrow, be rid of the stuff, and have a free weekend.
    I could use the cash, but I could also use the peace of mind. I choose peace of mind!
    Thanks Trent

  58. Couldn’t agree more with the sentiment of this post. I’ve been scowering sites over on my blog based on this maxim – just try to get the most amount of money for the least amount of effort.

    I also had that a-ha moment myself today while driving to fill up gas. There is a gas station 6 miles away from my work, but not on the way, which is 15 cents cheaper per gallon. I could go up there & save a buck eighty a tank, every week – that could sure add up. Except that it adds another 12 miles to my commute back & forth, and at my car’s mpg – that is a little less then 1/2 a gallon, which at today’s gas price’s is – a buck fifty. Factoring in my time, it is not even close to a wash to pinch that penny – even if it could add up over the long run.

  59. Rachel says:

    I realise that the point you make is about weighing up the profit you would make from doing something the harder way against the effort involved, but I have two points about your example (and I have no idea how hard it is or how long it takes to sell on ebay):

    1) 9$ extra profit for 40minutes is $13.50/hour which, if compared with your “true hourly wage” as you detail in an early post, may not be so far off for some, considering there are no extra costs involved. Also, the time involved is at your whim – you can check the account and deal with it when you have time, not have to report for work at a certain place and time for an uninterrupted session, making this $13.50 for a more flexible hour than an employment hour – even if you freelance you would need to spend more than 10min a time on a project.

    2) Assuming that this is a collection you at some point attached sentimental value to, the psychological cost of having just sold it off as a bulk collection may also play a part. My parents moved house just as I left home, and suggested I sell off some old toys and books to a collector rather than take them with me or them paying to transport them to their next home. Ebay-type sites weren’t really big then, and we phoned a local collector, who came to our house, looked over the whole collection, and offered a lump sum, which I accepted and he took the lot. I still feel that I gave up too easily on so many childhood memories, and selling them individually, at least certain choice items, might have made it easier to part with them

  60. dream says:

    Speaking as someone who recently started selling on eBay, Amazon and craigslist,(I found myself in DIRE NEED of a new income source!!) and who is also somewhat techie impaired, the time differences can be HUGE!! For eBay and craigslist items, you HAVE to add the time it takes to photograph the items. (Since I purchased my first digital camera to do this, the learning curve there also consumed some serious time!) My personal formula is pretty much down to this: Items that are over 30 pounds and sell for 100 or less go on craigslist. If I have the upc or it’s new and can be found easily on Amazon, it gets sold there.(Time IS a factor!) And last, if I can not figure out how to sell an item on Amazon, then I’ll list on eBay and hope it’s not wasted time!! Hope this helps a few people who are considering selling on-line.

  61. dream says:

    This actually pertains to the sunk cost fallacy too. Since I knew I needed a new revenue stream,(and have a tendency to procrastinate!!LOL), I just purchased a “lot” of items, THEN forced myself to learn how to sell them. Now I find myself another 3600 deeper in debt, (on variable rate credit cards no less!) with about 1500 dollars worth of pretty viable inventory and maybe 1200 dollars worth of other stuff I can probably sell eventually. I realize that sounds pretty ignorant, but in the process I have learned what people are still buying in a reasonably short time AND what to pay for said items in order to realize a reasonable profit.
    I also make sure I list all my inventory at the lowest price (For that item) on the site where it is listed because any return on my investment is better than none. Having the lowest price also greatly increases the odds of a speedy ROI. If I had decided to make sure I always made a profit instead of focusing on the fastest returns on my investment, I’m pretty sure I would be stuck with a lot of inventory AND the interest that accrues on the debt used to purchase it.
    My point here is you DO have to ignore “sunk costs” if you expect to survive, especially in todays’ economy!!

  62. Great article Trent. But then, if you had the time, wouldn’t you be better off selling the DVDs individually on Ebay if other projects you had to do didn’t yield as much ( you could wrap and sell the DVDs instead of washing the dishes for example)

  63. tentaculistic says:

    Anyone who has read my old posts knows that I tend to agree with Trent – in spirit if not in exact details… but this is one topic that I have to disagree with both! I think that when we try to break our activities down to sheer numbers, it is too reductionary because it leaves out all those intangibles. Like Trent has said previously, his enjoyment of an activity looms large in the inclination to do it… which after spending all this time explaining decisions based on a per-hour wage ends up coming out sounding a bit like the rules are shifting back and forth. Which is an inherent problem when you do that kind of reductionary math: if the only thing that counts is dollars/cents, no other factor (enjoyment, etc) seems valid.

    In addition, I find it disingenuous for the same reason that other posters do: you are comparing a daytime wage with an idle nighttime activity; in other words, you are pretending that your free time is being paid, when it is not. Even if you were not on eBay, you would not be working, you would be reading, surfing the Web, or otherwise messing around (for free).

    My last contention is with the details; other people have pointed out how ridiculous the eBay costs and potential profits are, and as a very experienced eBayer I have to agree. BUT I have to say that I would not try to sell CDs or DVDs individually on eBay either. You make money on eBay with designer labels (clothes, watches, teacups), even low-end designers, by exploiting sales or hitting discount stores and flipping it online. DVDs aren’t worth the hassle (significantly less than what he states but still).

    My advice for anyone interested in making a bit of extra money online is to look at Craigslist. Especially, for some reason, sofas and couches. This is the area that I excel in, and friends/family/coworkers regularly come to me looking for help with listings. The trick is to clean up the item and the area (squalor rarely sells items), take nice pictures (even a steady hand with your cell phone does wonders), write an enthusiastic review with enough specific details that a buyer will think it’s worth the time to come see it, and if possible put a link in to a comparable item new (and say outright how much it would cost new, preferably in the title). Most people put minimal effort into Craigslist and get minimal returns as a result; a bit of enthusiasm and detail goes a very long way.

  64. ShopkeepersDaughter says:

    When I was a young girl my parents owned storefront where they sold art they made of leather (mom) or jewelry (dad). They were always making things at home. I remember talking to them about pricing things and making money when I was as young as 6 years old. My mom would show me how she priced an item…cost of material (times 2 of course) and hours of work it took to create the item. She tell me that her time was worth $X amount of money to her at the time and assign a price to the piece. Later, when I was about 15, I started working after school as a waitress at a local restaurant. Having my own money I did what most teenagers would do – spent every dollar as soon as possible on whatever my heart desired. My mom started making a point to say to me “How many steps did you have to walk to earn that?”, “How many hours did you work this week for that trip to ?” As a adult I see how they made a specific effort to teach me about the value of my time and the value of my effort.

  65. Evita says:

    Sigh….. another article where Trent justifies avoiding unpleasant tasks on the basis that they are not worth his time! Avoiding unpleasant tasks should be justification enough when you do not need the revenue!!

    I admit that I find all this nickel-and-diming a bit irritating….. Trent, why don’t you write and article exporing “the fallacy of costing your time”?

    Respectfully your,

  66. Johanna says:

    To build on what Evita just said, I think that a big part of the reason why posts like this irritate me is that they carry the implication of “Well, *my* time is too valuable to waste selling things on eBay, because I am very busy and important, but for *you*, dear reader, whose time is worth less valuable than mine, and who are therefore inherently less valuable as a person, it might be a perfectly fine thing to do.” Especially because there’s not really any justification given for why Trent’s time is worth more than $13.50 an hour after taxes. (Surely he didn’t spend it all playing with his son, who was just an infant at the time.) I mean, I could just declare that my own time is worth a million billion dollars an hour, and that I am therefore more important than anyone who stoops so low as to work for less, but that doesn’t make it true.

  67. JF says:

    Can we expect a three page blog post every time someone makes an off-hand remark about your character?

    Your time isn’t as valuable as you think it is.

  68. Melody says:

    Well. Say what you will about this post – I find one thing Trent excels at is hitting a nerve. :-)

    To #36 specifically (and everyone else) I just received a check from someone whom I had sell items on Ebay for me. He was a customer of our business, and then I turned-around and used him! These were all electronics and security-related items that were old or could not be re-sold directly to a customer in our business. Yes, it cost me 22% above the Ebay and shipping fees I would have paid anyway, but I still made decent money and the real key was, like others here, I’d had the stuff sitting for awhile and never did anything about it. So it was justifiable to me simply to have the stuff out of my house and I realized that to bemoan the money lost in selling was to kid myself into thinking I would have actually done it.
    As for the ‘what your time is worth’ theory, I subscribe to it. As others have said, though, it is subjective. I run a family business with my husband and technically, I don’t get paid! So what is my time worth? I can’t judge it like that – I have to look at what the activity is going to bring me in terms of potential business, and then also weigh the following -
    -Frequency of the event
    -Cost associated with event (since we don’t get steady $$)
    -Potential contacts made

    If there is a yearly or monthly event for example, at the same time as one of my weekly networking meetings, even if it’s not work-related I would probably choose that because the likelihood of my going ‘next time’ is uncertain as is if there will indeed *be* a next time.
    We have gotten business from being in a Home Depot parking lot and enjoying our hobbies – there is no ‘right’ place to find a customer, though networking is obviously a place where people expect to talk about business.
    Since I have a family, I also have to weigh being broke now because of financial decisions and defaults or later because I’m paying for my daughter’s therapy. LOL Balance is a beautiful thing. (when you find it, let me know!)

  69. Laura says:

    Yeah, selling DVDs on eBay earns more than watching TV. Getting a second job working in a mine also earns more than watching TV. Most of us could probably be earning more money than we do, but we choose not to.

    I’ve sold a lot of stuff on eBay and it’s been a drag. There’s no way I’m doing that on my day off unless I see no alternative.

  70. reulte says:

    Something about value implies trade. If no one will give you $x for that particular hour … then it has no value. How many of us 9-5 Joes & Janes can sell the 2am hour for $13 and change?

    Hmmm, no that isn’t right.

    If you won’t accept $x in trade for that hour then that’s the value of all hours. How many of us 9-5 Joes & Janes would sell that hour of perfect summer afternoon on a hammock for $13 and change?

    I really hate trying to define the monetary value of things that don’t have a monetary value. You can’t buy an hour or a few days on ebay — you can only make choices about what to do now.

  71. Joey says:

    How many times will you make the same post about how valuable your time is? This weekly tirade has become almost Freudian in its desperation.

  72. Chance says:

    You just missed an opportunity.

    I did exactly what you are talking about. I sold all of my DVD’s on ebay. Rather than selling one at a time, I grouped them into 3, 4 and 5 DVD Lots based on similarity. I actually did really well this way and I saved time as well.

    The money in turn went to our house fund, so it was worth it for me.

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