Unnecessary Things

When I first began looking at how we could live well on less money, one of the first things that I noticed is that a lot of “modern conveniences” instead of truly being conveniences actually cost you more in both time and money than simply doing them an “old-fashioned” manual way. I cataloged quite a few of these, and will be writing about them individually in the future. For now, I want to explain how I began to think about these supposed necessities of modern life.

TCO is a popular business term, used frequently when evaluating new machinery or systems . It takes into account not just the purchase price of the machine and the time savings that machine is thought to provide, but also looks at the cost in man hours and dollars of training, maintainance, service, upgrades, supplies and a whole host of other things to come to a more accurate idea of the cost of owning and operating a piece of machinery.

I took the idea of TCO and started applying it to things in my life that were meant to be conveniences. Interestingly, I discovered that very few of these conveniences were conveniences, to me at least. If someone else were to do these calculations, they would get different numbers, depending on service costs in their area, their salary, etc…

To determine whether an item is actually a convenience or is costing you to own it, ad up the:

  • Purchase Price – What you paid for it (plus finance charges if you bought it on credit)
  • Training Cost – Take the time necessary to figure out the thing and multiply it by your net hourly wage)
  • Space Cost – This one is a little more complicated. This is the marginal cost of owning/renting a dwelling that is larger in order to house the thing. To figure this one out, divide your rent/mortgage payment by the total number of square feet you have, to determine a square foot cost. Then measure the footprint of the item in question, and multiply the footprint by the square foot cost.
  • Maintainance Cost – How much time and/or money will you spend cleaning, oiling, buying batteries, etc. for it?
  • Operational Cost – How much time does using it take, and how much power does it pull, both while in use and “on standby”?

Also, write down how much time the item should save you in a month.

Once you have a good idea of the total dollar cost of the thing, convert that to a man-hour cost by dividing the total cost by your real monthly wage (after taxes, and including unpaid overtime for you “exempt salaried” folks). Now, subtract this number from the number you wrote down of hours saved. If the resulting number is positive, that is how many hours per month of your life using the device is saving you. However, if the number is negative, that is how many hours of your life you are giving up every month just to have that whatzit.

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Published:
2.15.06 / 12pm
Category:
Pondering
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