[Guest Post by David Carlson of Dinks Finance]
Now that I’m in my early 20s and will graduate college soon, I’ve had to come to terms with the reality of my debt, cost of living, and the true value of each dollar I earn.
One idea I have recently been exposed to is high cost versus low cost hobbies and interests. It’s a pretty simple concept: A low cost hobby would be reading, while a high cost hobby would be snowboarding. Make sense?
So I evaluated some of my interests and it’s not always pretty… nor justifiable if I am trying to get my financial house in order. Some of the results are surprising, though (poker is not only a low cost hobby of mine but a profitable one!). Here they are:
1) Snowboarding – I started snowboarding about five years ago. When all was said and done it was about $700 to start (including a season pass). While this was a very high price it was worth it at the time because I knew it was kind of a now or never thing where I just had to get out there and do it. I’m glad I did it back then, but unless I am going to buy a season pass and go 30-40 times it’s hard to justify spending $40 to go out for a few hours of fun. Result: High Cost
2) Golf – Golf is something that I have been casually engaged in for about seven years. I got some cheap clubs (only about $130 for a full set). It’s so difficult, though, not having a high income and trying to take part in golfing. How can you justify $20-$30 for a round of golf? While I do see it as a good “investment” because I can do it probably for the rest of my life, I get frustrated not having the finances to go out to the driving range a few times a week to stay in top form. Even if you do have a significant income, there is no denying that golf is an expensive sport. Result: High Cost
3) Reading – While I love collecting books, I also love getting books for free from the library. I could get three books, spend two months finishing them all and have spent $0 (not counting gas and opportunity cost) by going to the library instead of purchasing online. Reading is quite possibly one of the lowest cost activities you can take part in! Especially if you like reading popular books because they are almost always available at the library. Also, reading articles and blogs online is extremely low cost; almost all content is free! Result: Low Cost
4) Poker – I had to throw this one in here because this is the most “out of the ordinary” hobby I have. I love playing poker. I have logged a ridiculous number of hours playing online poker as well as live casino play. Personally knowing people who have made over a million playing (see this article about a guy from my high school who made $250,000 in one tournament) gave me a little motivation to stick to it ; ) But this is actually a low cost activity for me, as I’ve made money (not much more than a few grand, but I enjoy it). If you haven’t played much before I would be prepared for this to start as a HIGH cost hobby. Result: Low Cost (for me!)
So as you can see, I have a mix of high cost and low cost activities. I am trying harder to focus on the low cost activities such as reading and poker, while minimizing the high cost activities until my budget can justify them. If that means staying in and watching TV or a $1 movie from Redbox, that’s okay with me.
One final note I wanted to make is that the cost of an activity also has to do with how much you engage in the activity. As I pointed out above, the variable cost of snowboarding drops significantly if I buy a season pass and go 50 times. Likewise, an activity such as board games can seem to be low cost until you spend $30 on that chess board you used once in five years. It all has to do with your interests, your time, and what makes sense to you financially.
What low and high cost hobbies do you have? Do you have any suggestions for low cost activities that readers might want to look into?
David works in finance and will be graduating in December 2010. He is currently in a serious relationship and lives in Minnesota. He has been blogging for two years now on topics as diverse as music, politics, and of course personal finance. You can follow him on twitter @DavidCarlson1.
(Kick ass photo by Evil Erin)
Bonus tip: Find a good "balance transfer" offer to help pay off debt faster!
If you’ve been making payment after payment (on time) and still haven't been able to get your debt under control, snatching up a good balance transfer credit card offer may be the ticket to try. That’s where in order to gain your business - credit card companies will let you transfer your existing debt to a new card and let you pay ZERO PERCENT interest on it. Saving you tons every month!
What's the catch? Usually balance transfer cards charge a fee (around 3% of your debt balance) to let you transfer your balance to their 0% interest offer. But we've found a great credit card that will let you do a balance transfer absolutely free. Click here to learn more and see if you qualify!
PS: If you don't trust yourself with another credit card, ignore this! This strategy is to help you get out of debt quicker, not risk adding more to it.