The Financial Independence Retire Early Movement or FIRE as it’s often known preach doing almost everything yourself with the intention of saving money faster, but we on the other hand believe that outsourcing is the key to freedom, happiness, and growth.
But it’s not just the FIRE community that have this ‘better to do it yourself’ mindset. From our experience, we’d say that most people would rather save a few quid and do soul-sucking work themselves, than pay someone else. You can’t build an empire on your own, and even if you’re not setting out to conquer the world, outsourcing chores will give you more time to do the things you love.
The FIRE community wish to free themselves from wage slavery, but their ambitions don’t go as far as freeing themselves from mundane chores. We agree that chores are the lesser of the two evils but they’re still grim tasks that can be outsourced. Why settle with doing anything you dislike?
In this post, we’re going to look at outsourcing from both a business and an individual perspective. Should you do it yourself or pay someone else? We’re going to look at the reasons to outsource, the types of outsourcing, and when to outsource. Let’s check it out…
No Respect For Time
We all know that our time on this earth is limited and yet the vast majority of people will squander it, whilst behaving in a way that worships money as if it’s a limited resource.
These people are doing it all wrong. We all need to treat time as if it’s precious and treat money as if it’s endless. You can’t create more time but both high street banks and central banks can and do create money at will. This is the frightening truth.
People all around the world are trading their limited youthful time today for small sums of money that governments can create freely and seemingly without restrictions.
Saving Pennies Is A Losing Game
Those who do not outsource any tasks because they’re trying to save a few quid are playing defensively. But you’re playing a losing game and have no chance of winning when all you do is park the bus.
Playing defensively doesn’t work because you’re not growing income at a fast-enough rate. The only way to win is by going on the attack. You need to bring in more money and convert it into wealth – that is, assets that are likely to grow in value rather than shrink.
Focus on Increasing Income
You need to focus on growing your income. Just as businesses are forever looking to grow profits, so should an individual. The reason to grow income as a priority is that it will buy you more time.
Most people recognise that if they build their income higher, whether that’s through a side hustle, business or even through progressing in a job, they can afford to outsource tasks, thereby freeing up precious time. But almost all of them say they’re too busy to put in the additional work.
They’re not lying – their schedules are chock-a-block. The problem is that their schedules are jam packed with other people’s priorities and low value tasks.
So, what are the Reasons To Outsource?
Number 1 – Outsource To Free Up Time To Reinvest
Outsourcing tasks will free up time, so you can be more productive elsewhere. Say you spend an hour a week doing the gardening. For the sake of this blog post, we’ll assume this is a mundane chore that you hate.
If you were to outsource the gardening to a professional could you reinvest that spare hour each week, maybe into drafting a business plan or developing a new skill, so that it increases your income above and beyond the cost of paying someone else?
In the home, you probably have a chores list longer than your arm. In addition to the gardening, you could outsource the cleaning, the cooking, the washing up, the ironing, food shopping, window cleaning, DIY, managing bills and whatever else springs up.
You can take this outsourcing to the extreme if you wish. Many wealthy people, especially successful business owners, choose to outsource all parts of their life.
Don’t underestimate just how much time many chores swallow up. Just the other day I (Andy – MU Co-founder) was thinking I need to do Christmas shopping but it’s a pain – if only I had a personal assistant to delegate this to. Well every successful CEO would just delegate this to his or her PA, so they can focus on what matters.
This leads us to reason number 2:
Number 2 – Outsource To Free Up Time To Enjoy
The end goal is to have fun, so outsourcing tasks to free up time is another great reason to do it. As we said, time is our most precious resource, so our actions are best spent in a way that maximises our free time.
The danger is that you set out to outsource chores with the intention to reinvest the time, but then laziness or distractions cause you to slack – we are all human after all.
It might be okay to outsource to free up time just to enjoy life if you are financially comfortable, but before doing so ask yourself whether your financial position is strong enough to justify it.
Don’t forget that the biggest drain on your time overall is wage servitude. So, from our point of view the priority should be on outsourcing chores to reinvest the time into a side hustle, to the point that you can at least free yourself from a job. Then you can outsource to find more time for fun.
Number 3 – Outsource For Expertise
When it comes to expertise such as a car mechanic or tax accounting, most people will happily pay for it. Here, the risk of doing it yourself and getting it wrong carries a cost that outweighs the cost of outsourcing. So, it’s a no brainer.
Say that you were buying a house. There’s a lot of expertise needed. You don’t want to get this wrong, so prior to buying the house you could go to University and study surveying, property law and banking, all of which would take years and cost thousands and thousands of pounds. This would be ridiculous, so instead you could just pay experts – saving you time, money, and reducing risk.
Types of Outsourcing
At its highest level there are 2 type of outsourcing – you can hire people or pay for automated tools and products that do the jobs more efficiently.
Hiring people is the type that usually springs to mind first. In the home, people dream of paying someone to do their chores, and businesses often first think about expanding the workforce before considering the second type of outsourcing – paying for automation.
We suspect that this order is due to a lack of imagination. In every job we’ve both had, the employees would whinge that more people are needed to do the work. Rarely do they think of ways to automate a solution to the problem. In most cases, a simple tool is available that will rapidly resolve the issue for a fraction of the cost of labour. People typically cost more than automation and are usually worse at doing the job.
In the home, rather than do the vacuuming yourself, you could hire a cleaner, but this would get expensive over time. Alternatively, you can buy a robovac, which will save you a small fortune. Likewise, we would never not have a dishwasher. The time it saves is a lifesaver, literally, as it saves us from wasting precious life-hours washing up.
When To Outsource
There are three trains of thought when it comes to outsourcing.
The first is that you should never outsource, and you should do everything yourself. Earlier we alluded to the FIRE community and most of the general public who think this is the best approach.
“Why pay someone else to do it, when you can do it yourself” is what they tend to say. You’ll find these people installing their own new kitchen, changing their own car brake pads, and when they book a holiday, they will painstakingly piece together all the parts rather than pay extra for a packaged holiday.
Yes, they will save a few quid but at the cost of their time.
The next thought process is to do it yourself until it hurts. This certainly has its merits when it comes to the hiring of people but if there’s a piece of software, product or an automated service that can help to avoid this pain, then we would be inclined to use that before it hurt.
The third and final idea is that you should outsource as soon as possible, as not doing so hurts business growth and you. For example, if you can outsource a task for a thousand quid and it brings in two thousand quid, then it’s a no brainer.
We quickly worked out that we could improve the quality of these YouTube videos by using supporting footage, known as b-roll. We could have shot the footage ourselves, which would have been extremely time consuming and expensive, or we could pay for stock footage.
We didn’t wait until our profit covered the expense. We knew the sooner we improved the quality the faster our audience and profit would grow. If we had waited until it hurt, then our business would have suffered.
In other words, outsource in anticipation of future growth.
When To Outsource – Other Considerations
Should You Outsource Investing?
As a money channel we felt this particular question might be of most interest to our audience.
When it comes to investing there is multiple levels of outsourcing. You could delegate the entire process to a financial advisor. If this saves you time to reinvest elsewhere in your life, then it might make sense. You will pay more for the privilege.
Likewise, you could build your own portfolio of funds or use a robo advisor, and these are also a form of outsourcing as they do most of the work for you. The cost here is negligible, however.
And finally, you have individual stocks, which is the do it yourself approach. There’s no better way to learn than doing it yourself. Picking stocks does carry with it a lot of risk but equally if you are good at it you can make much greater profits.
Investing is one area where you might benefit from taking a more hands on approach, and if you have the skills to pick individual stocks you can outperform the market.
The Stake platform for instance is one of the cheapest ways to access the world’s largest stock market, the US, so if you are considering buying stocks yourself, you could check them out – they’ll give you a free stock worth up to $100 if you use the link on the MU Offers page!
Is Outsourcing Worth The Cost?
If you have a patch of grass that needs cutting but it’s just a few square meters, it may mean the job is too small to be worth being outsourced.
Rather than get a gardener who would charge you the same price if your garden was 10 times the size, it might make sense to eliminate the job entirely. In this case, you could lay down a lower maintenance patio and be forever free from this nagging chore.
Though, it’s worth considering whether you hate the chore or just the time it takes. Can you cut down your work hours at your job instead?
What do you outsource and why? Let us know in the comments below.
Also check out the MoneyUnshackled YouTube channel, with new videos released every Monday, Thursday and Saturday: