Many examples from my own life illustrate the point. I arise at 5AM to exercise before it's too hot in Vegas and therefore save the gas required to travel to a gym and any membership fees. When I finish with work and after the commute, dinner and feeding my dogs, four hours remain in which to do whatever I wish. If I cannot use that time to make money, I use it to save money by doing things like changing my own oil, cleaning the carpets, or landscaping the yard. Although I could get my oil changed at WalMart for around $20, if I buy the oil and filters myself it costs me $9 in supplies (4 quarts at $1.50 each and $3 for the filter), and I save $11 doing it myself (Jiffy Lube and similar chains I save MORE), which is about how much money I'd earn if I were at work for the 30 minutes it takes to change my own oil.
Sometimes it pays, but only if the cost benefit ratio is worth it. My grandfather used to pay us grandsons $20 to mow his lawn. He owned two adjacent lots at a corner, one of which was landscaped in grass with a large garden. Mowing the lawn was therefore an arduous task, but $20 was an awesome wage for us back then. When we grew up and were no longer around, he paid a service $50 to do the same job. My grandfather was a pharmacist who specialized in geriatric and post-operation service, and he had contracts for clients who might come at any hour of the day. Nobody knows how much money he's worth, but as a pharmacist he was always on call to make money, and he probably earned more than $50/hour. Eventually, he subdivided his land, built a home on the park, and sold it for $500,000 profit. Now he pays a service $20 to do the smaller lot, which is worth it since he's now 84 years old and cannot manage it himself.
I have tried to learn how to do everything I can do myself because if I paid someone else to do it, I would probably not do something productive in the meantime. The opportunity cost of this example assumes that your free time is used productively in another more beneficial manner or that you are having it done during times when you are making money. Even on work days, in my after hours, I have five hours per day discretionary time. Again, if I cannot use it to make money or to better care for my money, I use it to save myself money.
For example, Saturday I changed out the AC system on my 1999 Suburban (AC Compressor and lines). I found the parts for $200 less than the dealership by buying online and used online discussion boards for tips and tricks when I hit a snag. Although it took me eight hours, I saved about $800 in labor, which is far above my hourly wage, even though they would have finished it potentially faster than I. There is no guarantee that they’ll do a better job than I will.
As in the continued example of an oil change, my ex wife used to make me take cars in for service, and at the suggestion of someone I’ve long forgotten I started marking the oil filter with a sharpie to make sure it was changed. Three out of the five places to which I took my vehicle didn’t change the oil filter although they charged me full price, and none of the five places put the 4.5Qts oil in that my engine uses- they just put in 4Qts. My Saturn burns 1Qt/1250 miles, meaning that they put my engine at risk by shorting me that half quart oil.
Sometimes, if you want it done right as in honestly, you should do it yourself.
As a caveat, I will NOT be doing a custom shower in my next home. After having to redo it this winter when the membrane leaked, I decided that standard sizes have a better cost-benefit ratio since the custom work exerts little if any upward pressure on the home’s value when it comes time to sell.
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