Those that have known me for several years have probably noticed that my hair style doesn’t vary by much from year to year. A lot of that has to do with the fact that I have four cowlicks embedded on my scalp and there are two ways to deal with the hairy mess; 1 – Keep it long or 2 – keep it short. As you have guessed, I have opted with the short route. The short hair style didn’t come to me by accident as I actually weighed the pros and cons and found that the ladies, and by ladies I really only mean TJ, prefer me with shorter hair. It also doesn’t hurt that maintenance is horrendously low as it requires zero hundred minutes to style in the morning and I can get away with one bottle of shampoo for a year or two. Short hair also makes it very easy to groom. So easy in fact, that I’ve decided to never pay someone to cut my hair ever again.
As a result of this, for the past three years I’ve spent a grand total of $0 on haircuts. I dropped $30 at Wal-Mart to pick up a pair of clippers and scissors over three years ago and have had TJ cut my hair since. This was a trend I picked up in college when my buddies started cutting each others hair in exchange for a haircut in return. Here are some fun numbers that I came up with:
Average cost per haircut: $15
Cost of clippers: $30
Number of haircuts since I bought the clippers: 58
Realized savings: $870 – $30 (clippers): $840
Not bad overall for a good haircut. In my opinion TJ cuts my hair better than anybody can. I’ve had stylists go at it and somehow they end up missing a chunk of my hair or try too hard to impose their own flare to my head. I feel that I’m getting a great steal here; better haircut and for free! But the realized savings can be even crazier if I make good use of it.
In simple terms opportunity cost is the benefit you could have received by taking an alternative action. Rather than spending $15 on a haircut every three weeks as I am accustomed to, I could put this money towards my mortgage or even invest it. Right now I am taking $15 after every haircut and putting it towards our mortgage which has a current interest rate of 6.25%. At our current rate of payment, we will have the mortgage paid off in about 15 years. So here’s the math for my “free” haircuts:
Monthly savings: ~$22 (Roughly 17 haircuts a year at $15 per cut)
Interest rate: 6.25%
Extra-payments made on mortgage: $3,960
Savings from interest: $2,359 (3 mortgage payments)
Total savings/Opportunity cost: $6319
Obviously this is a no brainer for our family and probably for a lot of guys too. Most guys can get away with a manageable hairstyle that a friend or wife can help maintain for cheap. Just make sure you don’t end up on this website.