If you’re used to paying for everything with cash or credit, you might be surprised to learn about a whole other economy out there: the barter economy.
Bartering, or the trading of goods and services, is as old as humankind, and it’s seen an increase in popularity in recent years as traditional economic models have been strained.
Here are some ways to start getting involved in this lively and practical method of getting things you want without paying a cent.
You’re probably already doing this to some extent — every time you borrow your neighbor’s lawnmower, loan the woman next door a few eggs, or even walk your friend’s dog. We don’t really think of this as barter, per se. It can usually be chalked up to just being nice. If we recognize it as barter, however, we’ll start down the path to legitimizing and understanding this facet of human economy. On a practical note, thinking of it as barter might also inspire you to keep records and perhaps even start a community Facebook group, Google spreadsheet, email list, or other method of keeping track of who has what to trade in your circle of neighbors, friends, or colleagues. Bringing informal barter out into the open and formalizing it — at least a bit — can draw in people you might not expect. You might discover, for instance, that one of your neighbors has just the woodworking tool you’ve been needing, or that the teenage boy down the street has been looking for a dog-sitting stint in exchange for help with his calculus.
If you want to be a little more formal, you might consider joining (or starting!) a community barter network. These can be for neighborhoods, towns, villages, suburbs, cities, or even states, and they link up people who have something to trade and are looking for things they need, from cooking lessons to carpooling. Check out your local barter networks and see which ones might serve you well.
Bartering for small businesses is, in a word, big business. Many major cities have professional barter networks for businesses looking to trade their goods and services. Most of these business barter networks will keep track of your trades, publish lists of business members and offerings, and give you access to your account so you can see what you’ve earned through trading. These business networks facilitate all kinds of trades. A company might make signs for a restaurant, for instance, and in return get a space to host a wedding reception. Another business owner might offer a vacation rental package in return for cleaning services. The combinations are endless. And though they don’t bring in cash profit to the businesses involved, they do help the bottom line by bringing in new customers, moving excess inventory, and making new connections.
Remember that all bartering has potential tax consequences, since the IRS equates barter income with regular earned income. If you do get involved with bartering, therefore, it’s important that you consult your accountant or tax preparer for advice on how to proceed, what records to keep, and how to value anything you’ve acquired or given away through bartering.
In the end, bartering is as much about community-building as it is about economics. So get out there and trade. You might be surprised how much you get in return.