The “Buck An Hour” Rule

Here’s a new way of thinking about your expenses!

Saw this comment on our post about the 10 things people don’t expect in early retirement, and been stewing on it all morning since…

From commenter DS:

I created what I call the ‘Buck an Hour Rule’. Basically entertainment should never cost more than $1/hour of your income. That new video game for $70 should return no less than 70 hours of actual entertainment. A $60/month cable TV bill equates to 60 friggin hours in front of the boob-toob – practically a whole WEEK dedicated to watching TV (insanity!).

Not everything fits $1/hour (car, etc), but you CAN calculate the cost/hour and see that $600/month for that nice car you drive 3 hours/day is not a good way to spend your hard earned cash.

Such an interesting way to assess things! A bit arbitrary and perhaps simplistic, but sometimes it’s random ideas like these that go on to spark new habits for us. I still haven’t forgotten about Cait Flanders’ Adventure Tuesdays we blogged about 3 weeks ago! It always helps to bat around new thoughts when we come across them…

And even more fun – putting them to the test to see what happens ;)

Pulled up my recent transactions to see how I’d fair, and it wasn’t pretty, haha…

  • Netflix @ $10.99 Pass! We definitely get at least 11 hours of entertainment from this between our family movies and our kids’ 1-show/day allowance when they behave… (75% of the time)
  • Gas @ $42.19Fail… But this is more of a “need” than “entertainment” (and definitely don’t have plans on giving up the car anytime soon!)
  • Cell phone @ $30.70Pass! I don’t talk on it for 30 hours/mo, but I’d imagine if you include all the email checking and social posting and everything else done on a phone it all adds up? Though less faster when you opt out of Facebook on it (good riddance!).
  • Coffee @ $2.19Fail. And it doesn’t matter what you say to me – every penny is worth it :)
  • Old currency notes for my collection @ $250.00Fail. I enjoy the thrill of the hunt AND I research them a good bit after they come into my possession, but I certainly don’t spend 250 hours on them… Though I can re-sell them at any point and recoup most of the money when I’m through!
  • Book @ $12.38Pass! Books will always provide more value in the long run than they cost. PROVIDED YOU OPEN THEM UP AND READ THEM!!
  • Subscription to my hometown newspaper @ $3.95 Fail. This is both a pity and a petty expense ;) Pity because I desperately want to support my hometown and all things PRINT!! But petty because I don’t read it as much as I want to… And it’s also an *online* subscription, so ironically I’m not even supporting the printing arm of it, haha… (but I am the company as a whole!)
  • Monthly donation to local historical society @ $20.00Fail. But a decision where the ROI is more intrinsic than extrinsic :)

So a few passes in there, but a whole lot more fails, haha.. Good thing this is more of a suggestion than anything else! And also, not everything above exactly falls under “entertainment” either, but I wanted to play along and see how it felt (overall good, but I’m definitely going to be thinking about this more!!)

How would you do if YOU went back and looked at your spending??? Do you like this rule, or implement any others that work well for you?

Here are some previous ideas we’ve covered that can help you save/think more too:

The “Stranger” Test — When you’re about to purchase something, imagine a stranger holding the item in one hand, and the cash equivalent in the other. Which one would you choose?

The “Urgency” Test — Whenever you’re debating on picking up a new shirt/shoes/etc, ask yourself: “Would I wear this out of the dressing room right now if I could?” If the answer is yes, buy it if the price is right, but if you hesitate – put it down and run! This also works for buying books (would you want to stop and read this right this second?), buying art (would you swap this painting for another on your wall as soon as you got home?) or even choosing dates (would you rush to show him/her off to all your friends the second you had the chance? ;))

The Decluttering Test — This one’s more for deciding on whether to get rid of something vs buying it, but it’s still a pretty good one: whenever you’re deciding if you should keep something around or not, ask yourself if you’d go out and *buy it all over again* if you didn’t already own it right now. If the answer is yes, keep it around! If it’s a hard no, it’s time to finally let it go.

Again, some of these tricks might work better than others (or not at all!), but it’s about testing things out for yourself until you finally find the habits that stick.

Try implementing one or two of these over the week and then come back and let us know how it went! Worst case you learn a little more about yourself!

disappears in bushes gif

No dollar bills were killed in the making of this post… Though some had to be humpty dumpty’d back together again :)

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  1. Joe October 8, 2018 at 6:16 AM

    I like the “buck an hour” rule. The only frivolous thing we spend on is eating out and this rule isn’t going to work for that. Yesterday we spent $40 on dim sum for 4. That’s $10/hour…
    The rule works pretty well for our car, though. I got our car for $17,500 and it’s been 8 years already. That’s 70,000+ hours.

    1. Joe October 8, 2018 at 8:54 AM

      Oops, hours used. Our car has 50,000 miles of mostly local driving so probably 2-3,000 hours of use. At this rate, it’ll have to last 40 more years. Crazy.

  2. Frogdancer Jones October 8, 2018 at 7:39 AM

    I’ve put myself on a stringent diet where I have to read all the books on my bedside table and my kindle before I run amock again.
    I bought “The Next Millionaire Next Door” though. I’m only human…

    1. J. Money October 8, 2018 at 7:49 AM

      Haha… it’s hard to pass that one up :)

  3. Bernz JP October 8, 2018 at 7:50 AM

    Yes! I have three that passes the “Buck an Hour” rule. The car, the cell phone and one with flying colors, my golf clubs. Hooray!

  4. COD October 8, 2018 at 8:03 AM

    I guess it depends on how you define entertainment. I budget date nights under entertainment, and somehow I don’t think a $6 budget for a dinner and movie (for 2) is going to fly :) This “rule” also completely ignores the concept of quality. A dollar an hour for TV sounds about right, but concerts, the theater, etc. all offer a much more immersive and better experience, and to expect that to cost the same as binging on New Girl on Neflix (who, me?) is a little silly.

    1. J. Money October 8, 2018 at 9:38 AM

      Yep yep, good point… Vacations would fall under “better experiences” too.

  5. Lynda October 8, 2018 at 8:08 AM

    Books would be better value if I didn’t read so fast!
    I spent £12 on a book on Friday afternoon and read it in 3 hours on Friday night….

    1. J. Money October 8, 2018 at 9:39 AM

      Oh wow – you are good!! it takes me an entire month to get through a book – and that’s if it’s one I’m super into :)

  6. Dustin October 8, 2018 at 8:30 AM

    I do something similar, but it’s a buck per use for any item that I buy. Get a new running watch for $200? I better use that thing at least 200 times before I get another one.

    1. J. Money October 8, 2018 at 9:39 AM

      That’s a good one too :)

  7. The Family Escapes October 8, 2018 at 8:58 AM

    The Buck an hour framework is interesting. I’ll add this – and the others – the the long list of frameworks I want to follow and then ignore (especially if I disagree with the output) when making a purchase! :)

    1. J. Money October 8, 2018 at 9:40 AM

      Haha… it’s all about testing things out, for sure :)

  8. Shaun J Stuart October 8, 2018 at 9:11 AM

    I agree with COD. This rule probably won’t work for seeing a movie in a theater any place in America any more. But for smaller purchases for home use, it could be useful, especially if you split it up into a “per person” amount? Cost $5.99 to rent that movie on Amazon? If it’s 2 hours and your family of 3 watches, you’re good!

    1. Andy October 8, 2018 at 4:38 PM

      We just did that last week-end. Thought about taking family of 4 to second run movie theater at $ 2.50 per. Decided to rent from direct TV on demand for 5.99/. Saved $4 !!!

  9. Paul October 8, 2018 at 9:37 AM

    I’m with you on the coffee rule. Anyone that suggests drinking crap coffee or forgoing all together cannot be trusted. Like the 30 dollars a month I spend on coffee is somehow will prevent me from living a happy retired life… for some things this rule is too restrictive. Pretty much would never go to the movies as anything more than a redbox would be out…

  10. Jessy October 8, 2018 at 9:56 AM

    Yikes! Matinee movie: $8.03 = $4.00/hr. Fail.
    Gym membership: This hurts! I thought I was getting my money’s worth by going 4 times a week, but no, that works out to about $2.60/hr. Fail.

    Still going to the movies . . . .still going to the gym.

    1. J. Money October 8, 2018 at 11:29 AM

      Some rules are allowed to be broken :)

      1. Danielle Ogilve October 9, 2018 at 1:23 PM

        Completely agree. I think each person has their own exceptions

    2. Ben October 10, 2018 at 12:31 AM

      That’s because the value of both movies and gym extends beyond just the time you spend doing that one thing. When you watch a good movie, or read a good book, it may change your perception of the world and of the people around you. It may teach you new knowledge, or introduce you to new ethical questions, and at least you will keep thinking about it for a long time after you put down the book or leave the cinema.

      With a gym, it’s even more obvious: You don’t go to the gym because you like sweat and muscle pain so much for that one hour. You go because it’s good for your health and will pay off 24 hours a day. Unless the gym costs more than $720 / mo, it will always pass this test.

  11. Danielle Ogilve October 8, 2018 at 10:39 AM

    This is a good rule of thumb for a lot of things! Need to try this out!

  12. Carol October 8, 2018 at 2:52 PM

    Oh, I kinda like thinking about this! Interesting idea. I put certain things into a category of “pay now and get benefits for life” category. For example, exercise. I know I get to classes much more than I get out for a walk in the cold, and I know I get a MUCH better workout if I’m in a class that pushes me for a full 60-90 minutes vs. just on my own in a gym. Not to mention I pre-pay for classes and memberships, which is gets me to actually attend. And I really, really like the people so I feel social connection and friendship. So, the $10-15 I pay for an exercise class gives me health and social benefits I feel for longer than that hour I’m there. While I admire folks who can get on their bike no matter the weather or can just buy a set of weights for their living room, I can’t make that work as well for me. I think the same for relationships. Going out on a date night can certainly be cheaper than many average Americans do it, but the cost does give MUCH more lasting benefit than just the couple hours you’re together and focused on connecting.

    1. J. Money October 9, 2018 at 11:58 AM

      Agreed on all :)

      And need you TO COME HERE so I’m more inclined to go work out with cool people too!! I don’t have any close friends here to motivate me to do it :(

  13. Jane October 8, 2018 at 2:55 PM

    So, J$, how is $2.19 for coffee a fail? Did you only stay at the coffee shop for one hour? I’m not a coffee drinker, but most people start the day with coffee for that little (or big) buzz that lasts… how long? If it lasts two hours, if it improves the next two hours of your day, that’s a pass.

    Movies are definitely an exception to this rule. A rule with so many exceptions can be difficult to apply.

    One thing that has stuck with me for years (so long I can’t remember where I read it) is favor producing over consuming. It was said by a woman who would rather knit something than watch TV. Rather build something, cook something, make something, than go to the movies. Can be applied to kids at certain ages – artwork vs. TV. And you usually feel better about yourself after producing even something small, as testified to by the rise in maker fairs, knitting clubs, etc. The problem with that one for me, is that reading always feels more like producing than consuming.

    1. J. Money October 9, 2018 at 12:01 PM

      I like that idea :)

      But why does reading feel like producing vs consuming? Do you then go out and write/take action on the things you’re reading? (That happens with me if I read about $$$/entrepreneurship, which I’ve tried to limit in my free time for exactly those reasons, haha…)

      RE: Coffee – you’re right, it does last a cple of hours worth of brain buzzing :) And not like Panera Bread will let me take in my own coffee here to work – hah!

  14. Eric @ Flip n Finances October 8, 2018 at 3:10 PM

    I tested this rule with Google Play music for $10/month and we definitely have a PASS there. In addition, my phone is generally $30/month and I definitely pass that (thanks to Clashe Royale alone I’m sure haha).

    Other than that, our entertainment budget typically equates to eating out or misc. items. I definitely agree with this rule when it comes to monthly subscriptions!

    1. J. Money October 9, 2018 at 12:03 PM

      I saw that, haha… At first I thought she shredded a *collector* bill and the pit of my stomach dropped, but then when I realized it was normal money, I didn’t feel as bad :) Though I made sure to hide all my own cash here in the house as my kids LOVE to shred stuff too (!!!).

  15. Mel October 8, 2018 at 6:09 PM

    Hey J

    Kudos on the low phone bill. Do you still use Republic Wireless? I am considering switching and saving on our cell phone bill. Still planning it out; have to invest in 2 new phones since our current phones are not compatible. Any tips?


    1. J. Money October 9, 2018 at 12:07 PM

      Yup – Still with Republic and loving it! A friend of mine just switched to a new company that’s about to come on the market which I may look into as well (they allow iPhones, which is the only con to using Republic as they’re Android only), but as it stands I’m still w/ Republic :) A lot of the original kinks have been cleaned up, although every now and then the phone does get wonky.

      I’d also check out Ting Wireless, as well as Project FI ( which is Google’s service that I’ve heard other bloggers like and use, though they may still be limited to certain areas I think?

      Hope this helps!

  16. Kris October 8, 2018 at 6:30 PM

    The Buck an Hour rule works for the shoes I’m currently using. I wear a couple of work shoes and 2-3 shoes I use for going out and running. I bought each shoe at the average of $60 and have worn all of them way more than sixty times and they are still in great condition. Gonna wear them until they run into the ground,

  17. LadyFIRE October 8, 2018 at 8:25 PM

    I apply this rule to buying new steam games. It kicked my addiction to “oh look, a $2 game!”

    I wrote a blog about this a while back, but I called it the “Dollars to Fun ratio” – the DTF… no, not that kind of DTF, mind out the gutter ;)

    1. J. Money October 9, 2018 at 12:08 PM

      Haha… I’m liking the DTF name much better ;)

  18. Ant @ TheCashDiaries October 8, 2018 at 9:14 PM

    This is such a good way to think about things! I love these little tests – anything that helps me be more conscious of how i’m spending.

  19. Kate October 9, 2018 at 5:55 AM

    I put my embarrassingly expensive handbag to the test and it came up trumps! It’s the “disposable fashion” clothes that end up costing more per hour of use and I avoid them like the plague these days.

  20. Working Mom October 9, 2018 at 11:07 AM

    I use the “Stranger Rule” a lot and wanted to comment that a High Deductible/HSA plan causes me to use this rule more. I had a (free/covered) physical scheduled and happened to have a bad cough at the time from a common cold. The Dr. prescribed an inhaler to get me through some coughing spells. When the pharmacy said it would be $50 after insurance I thought, “If someone offered to pay me $50 to have a cold for 2 more days, would l take it?” I walked away without buying it (and the cough went away the next day).

    Same thing when my kids had influenza symptoms. First kid, we paid $120 for office visit, $200 for strep/RSV/influenza test, $150 for Tamiflu that they refused to swallow (and Dr. said would likely not do much). Next time one had the symptoms, we just arranged to keep them out of school for a week but didn’t see a doctor. Saved $470.

    Not here to debate when/whether to see a doctor but just commentary that the High Deductible plans are working in making people re-think if it’s necessary to be seen.

    1. J. Money October 9, 2018 at 12:12 PM

      Kids get sick alllllll the time too! Especially when school is back in session, ugh… It’s nice that you’re able to keep them at home whenever needed – most people don’t have that flexibility!

  21. lisa October 9, 2018 at 1:09 PM

    Here’s my pass/fail test for the buck an hour rule-

    Cell phone family plan-PASS- We pay $100/mth for 4 phones w/ unlimited everything (grandfathered in plan) and 2 of us are on it more hours than a day can hold while the other two of us use it for calling/texting.

    Movie Pass purchase- PASS- It was a Costco special for $90 with the ability to watch a movie everyday. Going to the cinema every week, sometimes going twice a week, it was a deal. I’d say a minimum of 104 hours of movie time a year.

    Fancy dress/shoes purchase- FAIL- I wore it 8 hours and had professional photos for mom & dad’s anniversary, but it doesn’t fit the rule. Unless I wear it for another 82 hours.

    Gym membership- PASS – We’re required to pay for a family gym membership through our HOA dues. Whether you attend or not. At about $600/yr,our family goes a total of 780 hours or more.

    Internet- PASS – this one was too easy.

    1. J. Money October 10, 2018 at 7:46 AM

      Fascinating about the HOA rule! Is the gym in your community or something?? Is it a good one? I wonder how many people end up using it because they’re paying for it or not… I got all kinds of questions for you today!! ;)

  22. JoeHx October 9, 2018 at 3:25 PM

    Just take longer to enjoy your coffee, and it should be a pass. Although after almost two hours and 12 minutes, it will probably be cold and nasty…

    I kid, but it brings up a great point if you’re doing the “buck an hour” rule not to game the system to get your entertainment up to the right amount.

  23. maria@moneyprinciple October 9, 2018 at 3:50 PM

    Love this; off to analyse my spending and bring it in line with the ‘buck an hour’ rule.

    1. J. Money October 10, 2018 at 7:47 AM

      I want a blog post out of you on it ;)

  24. Josh Steinberg October 10, 2018 at 5:56 PM

    Hey J Money!
    This “Buck an Hour” Rule is quite intriguing. One of the biggest ways to eat away at your income is monthly subscriptions, so this rule can definitely help you go through and assess which are worth it.
    I also emphasize on my blog to cut out coffee expenses. A lot of people don’t realize how much money they burn on coffee every month! lol
    Thanks for sharing this rule, I’ll definitely apply it to myself.

    1. J. Money October 11, 2018 at 7:01 AM

      You had me up until the coffee part ;)

  25. Lyn Alden October 10, 2018 at 6:30 PM

    That’s a great rule.

    Sure it’s arbitrary, but that makes it easy to remember. It’s a reference, not set in stone.

    That’s basically the math I do in my head when buying something. My husband and I each spent $60 on a game, for example, but we got 300+ hours out of it. I’m thinking, “that’s way more than five movie theater trips worth of fun for the same amount of money”.

    Peak moments can of course go above $1/hr, but it’s best to keep most entertainment relatively inexpensive and use this as one comparison tool.

    1. J. Money October 11, 2018 at 7:00 AM

      Yup – games are a ton of bang for your buck. Also cards. My kids and I play approximately 300 games of UNO a day and they enjoy it more than any of their millions of toys laying around ;)

  26. lisa October 12, 2018 at 3:24 AM

    J.Money- About this forced gym membership from the HOA……….. There are 4 gyms in our town. They have:
    a pool (indoor or outdoor or both)
    running track
    cardio area
    weights area
    one has a golf simulator
    rooms for spin classes/aerobics classes/various kid and adult classes, cooking classes/pottery/etc….
    They put on shows- acrobatic, haunted paranormal, wildlife, ….
    They have various other events in the buildings- community garage sales, special ed activities, basketball games, badminton. racquetball, dodge ball competitions…
    rooms for birthday parties and meetings
    Some gyms have batting cages, personal trainers, etc….

    These activities do cost extra but to go and work out isn’t extra. They do keep a tally of how many people enter each building each day and I believe the total for the year (cumulative) is a few million? My neighbors and their kids do not go. At all. I don’t believe most people go, really. Most of us are in the age of 40’s/50’s with a sprinkling of high school and elderly that go.

    1. J. Money October 12, 2018 at 7:26 AM

      Fascinating!!! I’d love to shop a yard sale there, and then come back later at night for some haunted paranormal activity, haha… (And then maybe do a work out somewhere in between if there’s time ;))

  27. Debbie M October 12, 2018 at 9:43 PM

    I’m going to say your last two fails might not really be fails, because you only looked at the hours of fun given to you. If you add up the hours of fun given to everyone who is rewarded by your expenditure, it may pass.

    So if your subscription helps keep your paper in business, that may help lead to lots more fun for the employees and other subscribers. Plus, any event that you go to because you discovered it in the paper counts.

    And donations, by definition, are mainly about others.

    1. J. Money October 15, 2018 at 10:37 AM

      True true…. all very true :)

  28. Financial Orchid October 14, 2018 at 5:26 PM

    Interesting buck an hr rule. Reminds me buck of shuck. (Oyster fan here).
    Most of the entertainment I consume is free actually and online already. I guess we online users are just so used to consuming free info/entertainment in exchange for data instead of paying for subscription.

    I put a high priority on fitness and physical health so probably exceed the buck an hour rule for the gym and bike memberships, but the social interaction and health benefits makes it totally worth it to motivate me to stay active in an already full time cubicle envt