Money is tight for everyone these days. Bartering can be a way to stretch tight budgets. Barter is the ancient custom where people exchange goods and services directly, and without using money. There are some problems with barter. You have to have something that someone else wants, you cannot barter on credit, and barter will not make you wealthy. Do be aware that your country’s revenue authority may consider barter as taxable income. The Inland Revenue in the United Kingdom, and the Internal Revenue Service in the USA both consider barter as taxable income.
Barter in its simplest form consists of exchanging an item or a skill that you have for an item or service that you want. If you are a good cook who needs a haircut, and your friend is a qualified hairdresser, but a terrible cook, she might offer to cut your hair, if you offer to cook her two meals for her freezer. Consider items that you have that you no longer need or perhaps you have skills that are useful to others.
Bartering opportunities can be informal. Sometimes friends or neighbours have swap parties at which they swap clothing and household items they do not need for items that they want. Clothing is a particularly good item for swap parties. Women often have mistakes in their wardrobes, items they liked in the shop and bought but later decided were a mistake. In this way, you can lose your errors and gain ‘new” clothes. Swap parties also work particularly well with children’s clothing and equipment. Bartering or swapping items within your local community is also a possibility. Look on supermarket, local shop, or library notice boards, or try putting up a card offering a trade.
Bartering can also be more formal and as with everything today the internet makes this much easier than formerly. There are several barter internet sites. These enable people to exchange unwanted items for wanted things. Some barter web sites cater for particular needs, perhaps for children’s clothing and equipment, others sites are more general and have all types of goods and services available. Well known web sites such as Craigslist, list trades by city, others deal with a country or region.
Some countries have exchange markets. In Spain, especially in the Catalonia region, they are common. No money changes hands, people take things they have, but do not need, and exchange them for other people’s unwanted items. Three way exchanges are common and satisfy shoppers’ needs in some circumstances.
Barter can be a good alternative in slow and unstable economies. In Argentina, in 2001, the economy was in a parlous state, the peso’s value was dropping and living standards dropping so low that people’s salaries could no longer support their families. The market economy, based on money, was failing Argentinians and they turned to barter in desperation. They set up exchange clubs or markets and people took whatever they had to trade for the things that they needed. One shoe salesman, finding that people had no money to buy shoes, in the normal way, took his shoes to an exchange club and traded them for fruit and vegetables to feed their families.
Some local communities have established time bank schemes. Some United Kingdom communities have set up local exchange trading systems or LETS; these are local networks of people, who trade skills, services and goods. In LETS schemes each good, skill, or service has a LETS value, for example, an hour’s work may be worth six LETS. Mrs. Perks asks Mr. Brown to mow her lawn and tidy her garden. If Mr. Brown works for four hours, he earns 24 LETS, but wants to save his LETS towards something big. At the end of the year, he receives his annual statement showing how many LETS, he has accrued. LETS schemes may include businesses, self-employed people and the residents of an area.
One scheme in Brighton, Sussex, England has run successfully since 1991. A small membership charge, seven pounds and fifty pence sterling (12.19 dollars US) enables them to trade with other members. The membership fee covers the scheme’s costs; these are costs incurred producing three directories each year, stationary and printing chequebooks. The cheques, called LETS, are a form of Exchange and these are not true barter schemes, but they do solve some problems of barter systems in that people can bank LETS.
Environmental organizations promote barter as a useful way to reduce waste. People discard billions of perfectly usable items every day. Every country is running out of landfill sites and people needing those items go and buy new things, which use precious resources in their manufacture.
Some organizations see barter as a way for people to survive the financial crisis affecting countries all over the world. Others see barter as an alternative economic model and a way to oust banks from their supremacy in such an economy. There are some high-blown ideas about barter, but what is true is that it can help you when money is problematic. Whether you get together informally with friends and neighbours to exchange goods, skills, and services, go to an exchange market, join an organized scheme such as a LETS or time bank scheme, or trade over the web at one of the many trading web sites, barter can help you to stretch the budget in difficult times.