If you are trying to get out of debt, you may feel that you need to cut all “unnecessary” costs and do everything yourself. Drop your dress shirts off at the dry cleaners for washing and starching? No more. You will do it yourself to save money. Hire someone to clean your house every two weeks? Nope, you’ll do it yourself. The same with mowing your lawn and trimming the hedges. Preparing your taxes? No, you will do it yourself.
While you may think that you are cutting corners and saving money by doing all of these tasks yourself, you may actually be costing yourself money.
Consider a large corporation. They don’t do everything in house. They may hire an advertising firm to do their commercials because they know the advertising company specializes in creating compelling ads and, therefore, bringing the company more business. Likewise, they may rely on those institutions offering corporate finance to analyze their corporation’s cash flow management to ultimately help the company become more profitable. Large corporations know that by spending money on specialists, the company can ultimately make more money.
Even if you are trying to get out of debt and hate to part with any money unnecessarily, keep in mind that obsessive frugality may hinder your attempts to get out of debt because doing so many tasks yourself may reduce your income earning capabilities. If you are trying to generate as much money as possible, you probably work overtime at work whenever you get the chance, and you may have a side gig or two. How much do you make per hour in your side gig? Do you make more than it would cost you to hire out specialists to iron and starch your shirts, mow your lawn, and clean your house? Often, the answer is yes.
If hiring someone to do these tasks frees you up to work more and earn more, it is wise to hire out the services.
Likewise, while it may cost money to hire a tax accountant to do your taxes, chances are the accountant may know of ways to reduce your tax liability and save you money. That is a worthwhile expense.
If you are trying to generate as much income as possible to pay down debt, look at what corporations do to increase their profitability. They hire outside experts so they can focus their time on what they are good at and what makes the company money. You would be wise to do the same.
Post by Melissa