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الأربعاء، 2 مارس 2016

Managing Expensive Hobbies So They Don’t Destroy You Financially

Ken writes:

Golf really isn’t that expensive of a hobby if you do it smartly. My friends jokingly call me the “cheap golfer.” I mostly play at the inexpensive public courses near where I live and I gather up balls that other people have lost and just use those. The only expense really is the green fees and I use coupons most of the time to make that cheaper. I’m not an “every single weekend” golfer but I probably go twenty times a year and I can guarantee it’s cheaper for me than a lot of other hobbies would be.

Ken makes a great point: hobbies really are only as expensive as you make them. However, many hobbies – and golf is certainly one of them – create situations that predispose people to spending a lot of money.

I tend to identify golf as an “expensive hobby” because it shares a few traits with other expensive hobbies. In fact, virtually every expensive hobby has most (if not all) of these traits.

First of all, expensive hobbies often require you to spend to participate. You can’t participate in golf without paying the fee for a round of golf. Similarly, you can’t drink wine without buying an endless supply of wine, so must consumption-based hobbies fall into this category. You can’t dine out at all the latest restaurants in town without keeping your wallet open. You get the idea.

Second, expensive hobbies have an endless array of tempting purchases. With golf, there are always better balls and better clubs and so on that will theoretically make your gameplay better. Almost every consumption-based hobby has new things to try out, from a new craft beer on the market to a new bottle of wine at the store to a new restaurant in town. Those new things are generally expensive and the hobby naturally encourages those purchases.

Third, expensive hobbies are often very well marketed in order to leave you feeling “incomplete” if you don’t indulge in all of the optional buys. I’m not just talking about advertisements here. Most expensive hobbies have a litany of online and offline publications that are packed with articles about things you “need” to buy or places you “need” to visit. All of these things encourage a hobby participant to spend more and more and more in order to have a feeling that they’re “keeping up” with the hobby.

Fourth, the price of new gear and new experiences related to the hobby can be astronomical. Want to golf for a round at Pebble Beach? $500. Not a joke. Want to dine out at Masa in New York City? $2,500 per person. Sure, these are incredibly expensive high end options, but many hobbies have nothing that can even remotely compare to it.

Finally, participating in these hobbies socially can create a “keeping up with the Joneses” effect. If you go golfing and everyone else has expensive gear while you’re using a starter club set and balls you found in the rough, you can feel out of place and feel jealous of their gear. If you go out to eat with friends regularly and they can’t stop talking about some new restaurant, it is going to be very tempting to go there. Those are perfect emotions to encourage you to spend more money.

Each of these factors play into the expense of a hobby, and some hobbies manage to hit all of these factors at once.

Of course, each of these factors points to a smart strategy for saving money on that hobby.

Money-Saving Strategy #1 – Shop Around and Use Coupons to Cut Participation Costs

Unless something is in incredibly high demand (where they’re selling out all available slots and items at whatever high price they’re charging), you’re going to be able to find discounts and coupons for that thing if you’re patient and watchful.

There are many different ways of doing this. My preferred method is to simply seek out online forums dedicated to frugal participation in the hobby – for example, this one dedicated to cheap video games. Virtually every pricy hobby has an online forum and community dedicated to participating in that hobby at a discount.

Another good strategy is to sign up for the mailing list of retailers associated with your hobbies, but sign up using a special new email address (through Gmail or another free online email service) that only collects such email so that you can search through it whenever you’re considering a specific purchase.

When you are considering a specific purchase, definitely shop around. Look at a variety of retailers that cater to your hobby, as well as general retailers like Amazon. For example, in the boardgaming hobby, two retailers to always check for prices are CoolStuff and Miniature Market.

If you’re considering paying for an experience or an entry fee, don’t be afraid to haggle. I often do this over the phone. For example, I might call several different golf courses in the area and directly ask if they’re offering any discounts right now as I’m considering golfing in the next day or two. This works well if all of the slots aren’t taken. Sure, most businesses won’t offer a discount, but some will and that can make a big difference.

Money-Saving Strategy #2 – Focus on “Bang for the Buck” Experiences and Items

Rather than focusing on buying the “best” item possible – which usually translates to the most expensive item – focus instead on maximizing your “bang for the buck.” Look for purchases and experiences that offer the most value for the dollar.

Often, the most expensive purchases fall far short in that area. You’ll pay ten times as much for something that’s only 50% better than the next best option, for example. This is particularly true with new items, as new items often come with a premium that will vanish after a while and which makes other versions of the item a great bargain by comparison.

For example, rather than considering all cell phone options when you go to buy one, look instead at just the ones that are free or just a few dollars with your contract renewal and choose the one that best meets your needs from among those options. It will do almost everything that the expensive item will do at a vastly lower price.

Another great example is the library. The “bang for the buck” here is at an awesome price point – you can get the books you want to read or movies you want to watch for exactly $0.

Money-Saving Strategy #3 – Avoid Hobby Publications and Websites

While hobby publications and websites often feel like a fun place to read to learn more about your hobby, most of the time the articles and material there are nothing more than sales pitches for new and high-end items.

Sometimes, the articles are little more than a re-written sales pitch or press release, lauding some new experience or new item as being the greatest thing that has ever existed.

Even when writers have the best of intentions at those publications, they’re often reviewing items that they received for free and thus the cost is not really a factor for them, so of course they’re going to review the ultra-expensive item as being a little better than the moderately-priced item. They’re not actually sacrificing anything in their life for those items.

I’ve come to avoid such publications for my hobbies most of the time. I really only participate in online sites for hobbies that are basically free – like geocaching – or ones that are focused solely on participating in the hobby at a discount.

Money-Saving Strategy #4 – Don’t Waste Your Time with the High End

Sure, high-end purchases can sometimes be better than the “bang for the buck” items ore the more reasonably priced items. At the same time, however, the top-of-the-line items are usually incredibly expensive and rarely add enough features to make the extra cost worthwhile.

Whenever I’m shopping for an item, I almost always just completely ignore the most expensive 10% of options out there. Those choices are eliminated right off the bat for me – I don’t even consider them in my buying process.

Since I immediately put those purchases and experiences as being “out of range,” I’m usually left with a field of options that are reasonably within the same price range and reasonably within the same level of quality. Doing this makes it much easier to choose the option with the best “bang for the buck.”

Money-Saving Strategy #5 – Participate with Like-Minded People

Like it or not, social influence has a huge impact on which items and experiences you might consider purchasing within your hobby. The things that your friends covet often end up being the things that you covet, and vice versa.

Thus, if you’re participating in a hobby socially, it makes sense to strive to participate in it with people who have a similar frugal “bang for the buck” approach as you do. Actively choose to spend more time with people who have an attitude toward the hobby that doesn’t involve tons of spending, and at the same time pare down your time spent with people who always covet the expensive things and often throw their money down for those things.

You’ll find that your appreciation for the frugal side of your hobbies grows and grows and that your desire for the expensive items dwindles and dwindles.

Final Thoughts

Using these approaches in concert can turn a hobby that seems to eat up a lot of your money into a hobby that’s still incredibly rich and enjoyable without devouring every spare cent.

I use these approaches for my own hobbies, which includes playing board games, reading, and making home brewed beer. In each of those hobbies, these approaches have helped me to deeply enjoy the hobby while keeping a reasonable and healthy cap on my spending.

Good luck!

The post Managing Expensive Hobbies So They Don’t Destroy You Financially appeared first on The Simple Dollar.



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