How to Barter: Getting What You Need Without Spending Money

A woman delivers groceries to a house.
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Stay-at-home orders, business shutdowns and income loss are inspiring people to think creatively about getting the goods and services they need. For some, that means bartering with friends, neighbors and even strangers.

Bartering cuts out the need to use money. It’s an arrangement where people — or businesses — directly exchange goods and services without any monetary transaction.

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Jessie Stehlik, a photographer in Tampa, Florida, has always enjoyed bartering services with friends. In mid-March, she created a Facebook group to encourage trade within her local community.

“With everyone losing work, and unemployment checks still being at least three weeks out — if you’ve gotten through the unemployment website — a lot of people are really strapped for cash,” Stehlik said.

She wanted to be able to help people in her city connect and trade with each other. 

There are all types of things you can barter, even during times of social distancing. It could be a simple product trade, like swapping disinfecting wipes for toilet paper. Or you could barter a service, for example, shopping and delivering groceries to a neighbor who agrees to cook up a couple casseroles for you in exchange.

While bartering is an economic system from ancient times, it is resurging amid the COVID-19 pandemic.

In Las Vegas, a coffee shop owner traded coffee beans for fresh baked bread and wine. A New Hampshire man traded eggs for flour and created a 2,000-member barter group in the process. Bartering is becoming a solution to getting things you need during this challenging time.

Tips on How to Barter

If you’ve never exchanged goods and services by bartering, first think about what you can offer and what you need. 

You’ll also need to consider who you’ll be trading with. An easy way is to start with people you know.

Think about family members, friends, co-workers, neighbors or others within your social circle. The barter arrangement could be a direct request between two parties — like giving eggs to a neighbor in exchange for paper towels — or you could form a group, like Stehlik did.

If you’re creating an informal barter exchange with multiple people, you need to decide where communication will take place. Will you request needs and offer up goods and services in a group text or via email? Or will you use an online forum, like a Facebook group, or through an app like Nextdoor? (There may already be existing barter exchange groups you can join on those platforms.)

You may choose to open the exchange up to people you don’t know personally, but it’s wise to create some limitations on who can join. Stehlik said she confined her group to the Tampa Bay area so it’d be easy for people to offer up their services, like swapping a photo session for a cut and color from a local hairstylist.

A portrait of a photographer.
Jessie Stehlik, a photographer in Tampa, Florida, started a Facebook group for barter services in her community. Chris Zuppa/The Penny Hoarder

Instead of starting a new bartering group, you could join an established one. You can broker an exchange via Craigslist or on a dedicated bartering website such as BarterQuest. Barter Network and BizX are two business-to-business barter exchanges.

Some bartering networks are set up so you earn a type of barter currency — like a points system — from what you offer rather than having a direct exchange of goods or services. TimeBanks works in this way by issuing out “time credits” for the service you provide. You then use your time credits to obtain services from others in the network.

Before agreeing to barter with someone you don’t know, you should vet them by asking for referrals (if they’re offering up a service, like online tutoring) or a sample of their product (if they’re providing something they’ve created, like graphic design work).

What to Be Aware of When Bartering

To barter successfully, it’s important that each party is in full agreement with the exchange. The goods or services swapped should be of similar value or the same time commitment.

Put your agreement in writing and make sure each party signs it to acknowledge they’ll uphold their end of the deal. Include a time frame for when the item or service will be delivered.

“Make sure it’s clear what you’re each getting out of it,” Stehlik said. “Lots of loving communication from the beginning makes people less prone to problems at the end.”

Another thing to be aware of is to abide by social distancing guidelines when conducting your exchange. Schedule porch pickups and doorstep deliveries. Stick to services you can provide online or without contact with others.

Although money doesn’t exchange hands it’s important to know that the IRS does consider bartering a form of income, which you may be required to report when you file your tax returns. Generally, this does not include individuals who informally swap similar services on a noncommercial basis. However, if you’re a small business owner trading services with a fellow entrepreneur, you should consult with an accountant to discuss if you need to disclose the bartering transaction on your tax return.

Nicole Dow is a senior writer at The Penny Hoarder.