It’s been over a decade since one young Canadian man became somewhat famous for his ability to get a house for the price of a paper clip. How did he accomplish such a miraculous feet? He used bartering to trade up each transaction. If you aren’t familiar with the story, ABC news did a feature about it and it is quite an interesting story to read.
When you first begin reading his story you may find yourself thinking that it must have taken hundreds of transactions for his to reach his goal. But in truth, it only took fourteen.
What this amazing tale teaches us is that if you are budgeting you can use bartering to save money.
1. What is Your Goal
The first step when you are bartering is to determine your final goal. A simplified example of this is a story my parents told me about the summer they put a new roof on our house.
My parents were looking for a way to reroof the house and save money doing the work themselves. Once the job was complete, they hoped to be able to apply the money they saved toward a sprinkler system for our yard.
2. What Can You Offer in Return?
In order to barter successfully, you will need either a tangible object or a service to offer in return for what you desire. In my above example my parents traded labor with two other family friends. Each family also needed a new roof too due to recent hail damage from a spring storm.
When you barter to reach your own goals you should look for things you can part with that may have value to others. You could also barter labor, as my parents did, or skills by offering to teach someone how to do something they know nothing about.
3. Find Someone to Trade With
You will need to find someone who wishes to know the skill you are offering to teach or wants the item you are willing to give up. Again, for my parents the thing being traded was labor. My parents were easily able to find someone to barter with because their two friends had the similar goals in mind.
However, there are other ways to find a bartering buddy. For example, some communities have online bartering clubs you could join. Ask if you can advertise for help with your project and list what you have to offer in return. Include pictures if it is possible.
4. Make the Pitch
Convincing someone else to trade for something they already want but don’t currently have doesn’t usually require a great deal of skill. Most likely the reason for that is because they need what you have badly enough they are willing to part ways with what you need in return.
Of course, you may find that the value of services or items being traded differs. To equalize them sometimes another item of value must be added to the lessor item or service.
Bartering offers a great way to save money in your budget and accomplish other goals at the same time. Do use caution and follow the rules of the IRS to ensure you barter without legal consequences if you own a business. Try the above bartering steps to save money on your own budget.
Have you ever tried bartering to save money? What have you traded?