I just wrapped up an apartment search. In total, my girlfriend and I met with 5 brokers and viewed almost 15 apartments over 4 separate days. I’m guessing we invested at least 50 hours of time in the process, between phone calls, emails, research, traveling around town and just generally dealing with the annoyance that apartment hunting represents.
After all that, we settled on a unit in the building I already live in.
Why? Simplicity. When I began my apartment search, I was determined to cut my monthly rent by at least $200. By moving within my building, I am saving $150 a month (not quite $200). At the same time, I’m recovering a full month’s rent that would have been lost to our apartment broker. Amortized over the full year, that’s easily another $150 a month.
Had I made that choice from the beginning I could have saved myself and my girlfriend 100 combined hours of searching Craigslist, making phone calls and viewing apartments.
Moving would have involved:
- A U-Haul ($50-100)
- A full month’s rent as a broker’s fee in most cases ($1500+)
- Several lost days of productivity packing, hauling and unpacking everything
What’s the point?
In my excitement to cut costs, I discarded the easiest option (stay in the building) without considering the opportunity cost. I wasted valuable hours (and nearly a lot of money) trying to optimize.
I can make a lot more by investing those hours into my startup. The potential cost savings I gain by shaving some monthly expenses off my budget are far outweighed by the value my business gains from having the hours invested in it.
I think there’s a lesson there for businesses: Focus on your core.