Warning: A crab is caught and eaten in the making of this story. Viewer discretion is advised.
Since her arrival in Oregon, my mother has been extremely excited about going crabbing. She would recount the tales of her childhood crabbing expeditions fondly, recalling a time of warm, fuzzy family memories.
To be honest, I was not as thrilled as she was with the prospect of crabbing. It seemed like a useful skill to know for the zombie apocalypse, but the prospect of a crab pinching my fingers was very discouraging. In fact, my mom’s Facebook post captures the extent of my crabbing inclination:
My parents came home yesterday with a shellfish license though so there was no room to negotiate.
But since this is a personal finance blog, this isn’t just about crabbing. The title of this post is “Crab Futures,” after all. What do futures have to do with crabs?
Google’s beautifully concise definition of futures (a.k.a. futures contract) as “an agreement traded on an organized exchange to buy or sell assets, especially commodities or shares, at a fixed price but to be delivered and paid for later.”
Actually, our escapade with crabbing has nothing to do with futures per se since we didn’t agree to sell our crab for a fixed price. Futures is just a cool bit of financial knowledge to know. Fishermen, at least, could use this technique to sell their crab. We, on the other hand, all just agreed to eat it.
Futures aside, our trip crabbing was a lot of fun. The Crabmaster (my lovely uncle) caught one Dungeness crab that was legal to take home. He discovered his secret calling to be a crabber while at it (and made a cool video of our trip).
He was quite fearless. MVP all around.
Now for the important question (I still haven’t forgotten this is a personal finance blog), how much did that one crab cost us? (Hint: A lot)
Cost of Good(s) Sold (well, eaten in this case):
Chicken legs: $5.66
Crab License: $9/per person ($36 for the four of us)
Crab lessons: $0 (free event put on by Lincoln City)
Our adventure didn’t take us terribly far away and if crabbing becomes a pastime in my family, then we can do it closer to home. Therefore, I’ll put transportation at $0.
Total COGS/Eaten: $75.65
That crab is already looking super expensive.
We also have to factor in the opportunity cost of the crabbing trip, namely our time and the amount of money we would have made by investing that $75.65 elsewhere.
Assuming four college students—instead of one family—wanted to go crabbing, then I estimated the value of their time to be minimum wage at my university (since minimum wage is different everywhere in the United States). We crabbed for around four hours, and with the $10/hour I make, then the opportunity cost of time for a group of four college buddies would be $160.
Fun is, of course, priceless—as is time in good company. However, whenever calculating the cost of what you are buying, it is extremely important to consider the amount of time you spend.
Interest: 18 cents
Instead of investing in our crabbing knowledge, we could have invested that $75.65 elsewhere. I assumed that we would have put the money in a three month treasury bond, which currently has an extremely low interest rate of 0.24%.*
Total Cost (including opportunity costs): $235.83
How much our crab would have cost in the supermarket: $18.29 ($10.45/lb.)
Price of our crab: $217.46 ($20.81/lb.) Certainly the most expensive crab I have ever eaten.
If we keep up the rate of only catching one, 1.75 lb. crab every trip, then it will take us 12 crabbing trips (or just 12 crabs) to make up our costs (not including labor and the additional chicken we would have to buy). However, I fully trust that the Crabmaster will catch quite a few in future trips, especially in September when crabbing season actually starts.**
These were interesting calculations on our family adventure. However, even as a personal finance blogger, I think the price of our extremely expensive crab isn’t all that matters. In the end, having great warm, fuzzy family memories that I can recount online and to future generations is very valuable to me. We learned a new skill that would be useful should zombies attack, had a lot of fun, and can potentially make back our money.
In the end (to keep with the warm, fuzzy theme):
Bragging Rights: 0 (My uncle really did all the work.)
Good Food: 1 Crab
*I really questioned whether I should include this or not. It doesn’t actually change the number of trips needed to make back our initial crabbing investment, but it is an interesting opportunity cost to consider. Plus, 18 cents is almost 1/5 of a really good cup of coffee here, so it definitely matters.
**Classes, unfortunately, start on August 30, so I’m just going to cry on the way back to college.