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DIY projects can be a great way to save money, but how much? Often, we as workers use our hourly rate times number of hours to value time. This is partially correct, but taxes are regularly neglected. 

We must pay taxes; it is a certainty of life. Depending on your income tax rate, social security, medicare, and sales tax the hidden cost could be 20% - 50% higher than the sticker price. Put differently, when I earn $100 at work the government(s) get 20-50% and I am left with less purchasing power.  

Consider the cost savings of a DIY project. The savings of doing for yourself may be higher than you expected. There are also intangible benefits like a sense of accomplishment or learning a new skill.  

However, intangible costs may also exist. For example, saving $2,000 on a home project may not match up to missing a month’s worth of weekends with friends and family. There are some projects and tasks that we should leave to the experts. I highly discourage anyone from trying to extract their own wisdom teeth.  

What could you do for yourself today, this week, this year that would save you money? Make your own coffee at home, repaint the interior of your house yourself, or mowing your own lawn? We are limited only by our imagination and skills.  

By Zachary Simon, CPA, RFM Group