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Barter

What is barter?

Bartering was the original form of payment for services – before money was invented! Instead of paying for a product or service with money, when you barter you ‘pay’ for the service or product by exchanging a service or product of your own, of the same value.

For example, if you have chickens that produce more eggs than you need and your neighbour has a bumper crop of sweet corn – perhaps you can exchange (or barter) goods!

Of course, it’s not always as simple as that. What if your neighbour doesn’t want eggs, but would much rather prefer some of those strawberries that the lady over the road has grown, and she has her eye on the goats milk from the farmer down the road, who really wants your eggs!

So that’s where bartering societies and schemes come in. Not all communities have a bartering society, though.

Making bartering work

Here are some tips for making a barter scheme work for you:

  • Treat bartered services as ‘currency’ – don’t undervalue the service you offer or receive just because you aren’t paying cold hard cash for it.
  • You still need to adhere to all laws and regulations relating to your service. Licenced work still needs to be licenced under a barter scheme.
  • You may want to consider Public Liability insurance – again, just because someone doesn’t pay cash for your services doesn’t make you exempt from Public Liability claims.
  • Fair agreed value – if you want the guy next door to fix your roof, it will ‘cost’ more than a dozen eggs. But perhaps you could offer to mow his lawn for a couple of months, or spring clean is house, or make him new curtains?
  • In general, services should be repaid with a service – as people’s time is more valuable than goods or produce.
  • Involve the community – bartering works best when you have a wide range of services and products available within your barter network.
  • You can even barter on eBay
What can you barter?
Well you can barter anything that someone else will want. Like any business where cash changes hands, you need to be able to offer something of value. And that can be a service like typing, house cleaning, garden maintenance or baby-sitting to trade qualified or professional services such as carpentry, plumbing and accounting.

You can also barter goods and produce – garden vegetables, eggs, fruit, baked goods, etc.

A twist on bartering…
A variation to this is something we did when we were younger. We’d just bought a house – the type advertised as “a little work needed”, so you can imagine what it was REALLY like – but we were keen to get into it.

Our friends had just done the same and were about to embark on their own renovating journey. But we both soon discovered that it’s difficult doing renovations without assistance.

So for the next 12 months, we alternated renovating weekends. One weekend, our friends would come over and help us renovate our house, and the next we would go over to their house and help them with their work.

This was a great system, because we had a broader range of skills between the 4 of us, and 4 people working on the same thing produced much more than twice the results of 2 people doing the same job. We kept each other motivated along the way and the extra hands were invaluable for the heavy renovating work.
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We are not certified financial planners or advisors. The information in this website is general information only. Always consult a licensed financial planner before making any finance or investment decision.


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