How Much is Your Time Worth?
When we think about how much we are worth in terms of dollars, most of us use our jobs as a reference. If you have a job that pays you $50,000 per year and you work 40 hours per week, you are worth roughly $24 per hour. This does not take into account bonuses or other forms of compensation, but gives us a good idea of how much we are worth. It is valuable to take this information and use it in our lives outside of work as well. By doing this, we can get a better sense of how we should spend our time and ultimately live the lives we desire.
Do You Mow Your Own Lawn?
While we know our value at work, how much is your time worth away from work? Is it still $24 per hour? If you said yes, then in theory, anything that you have to do around the house that will cost you less than $24 per hour should be left for someone else to do. I’m not saying to just leave it, but rather hire someone to do it for you. After all, why are you taking that hour mowing your lawn when you could pay the neighbor’s kid to do it for $15? By paying him to do it, you just saved yourself $9 and one hour that you could be playing with your kids, writing a book, or hanging out with friends. If you said no, then you need to determine how much you are worth outside of work. This is more difficult and has an endless amount of variables. Because of this, when starting out it is easiest and best to simply use your value at work in your daily life outside of work as well.
For most people out there, this concept requires a little bit of thinking outside the box. Many people’s first reaction is “I’m not literally paying myself $24 to mow the lawn, so I’d rather do it and save the money.” While this is true in a literal sense, that you aren’t physically earning $24 by mowing your own lawn, you are losing money in other ways, including time.
Put A Price on Things
Personally, I value my time greatly. I know the things that I value doing the most. For me, spending the afternoon with my niece is awesome. When I try to put a price on this, I can’t. To me the time is priceless. So I would rather pay someone to mow my lawn and spend that time with my niece than the other way around.
The same goes for my free time. I value this greatly as well. I had the opportunity to take a job that would require me to have an hour and a half commute, both to and from work. Currently, my commute is 20 minutes each way. The salary for the new job was considerably higher, but I just couldn’t give up all of that free time. Now, if the salary for the job was millions of dollars that may change my mind!
Another personal example I have is changing my oil. When I was younger, I changed my oil myself. Now I’m at the point where the $20 to have someone else do it isn’t an issue. Not only do I free up the time, but I don’t have to crawl under my car and get all dirty and save the used oil and recycle it. It’s just easier to pay the $20.
Some may enjoy mowing your lawn, so to those I say keep mowing it! But if there are things that you don’t enjoy doing, instead of looking at the cost in terms of dollars, look at it in terms of time as well. Ask yourself “How much time is this going to take and what could I be doing instead?” You may find the other thing is much more appealing to you and that the money really isn’t as big of an issue as you think it is.
Increasing My Worth
As I said above, I enjoy my free time. During this free time, I enjoy blogging and working on other ways to make more money. In this sense, I am working to increase my value or worth to more than $24 per hour. The more I can increase this amount, the more things I can pay others to do for me, freeing up more time for me to do the things I enjoy. While I classify blogging and other business ventures as work, I don’t view them as such as I really enjoy doing them. To me, they are far from work.
Here’s an overall picture that I hope sums everything up. It is my hope to increase my value or worth to a point where I can quit working a 9 to 5 job and have unlimited free time. In order to get there, I have to focus on the things that are going to increase my chances of this. Mowing my lawn and changing my oil aren’t going to do this. So, I pay someone else to do them for me. As my value increases in time, I can pay people to do other tasks for me, so I can concentrate more on those things that will increase my free time. Eventually, my value will get to a point where I don’t need to rely on my boss to pay me to do the work he doesn’t want to do.
The point of this is to get you to think about your time so that you spend the most of it doing the things you really enjoy doing. Think back to the lawn mowing example. Worst case scenario is that you need your lawn mowed every week of the year. At $15 a week, that comes to $780. For most readers, you can get by with having your lawn cut every other week, which drops the price to $390 per year. And for more of you, you only need it cut in the spring and summer, then a few times in the fall. That gets you to $180. What would you rather have, twelve extra hours or $180?
I used to change my own oil. But at my age, one wrong turn and I’m in pain for weeks. When cutting the lawn I’m up right, so that is not much of a problem, yet. Besides, it is about all the exercise I get.
The neighbors on each side now use a lawn service for fertilizing and bug control. Our lawns are very small. They still cut their own lawns. But they rely on professional expertise for chemical applications. At $40 an application maybe 6 times a year or $240 is a bit pricey to my way of thinking. For $20 I do the chemical applications for the summer as needed. My lawn looks the best. They just never ask what and when I do the lawn. That is how society is these days. If the advertisement says “I’m the best.” then they must be right. If it is expensive, it must be better.
Something to think about! I’d think it be worth it to pay someone to job search for me so I could do other things like look for more work as a freelancer and work on current projects. It takes so long to fill out all the apps and search. If it lead to a permanent position, it could be worth it! (but I probably won’t)
Your analysis is deeply flawed because you did not take into consideration taxes.
If you assume your time at work is worth $24/hour, you are not actually collecting $24/hour because you need to pay taxes on that income (FICA, Federal Income, State Income, etc). Also, if you are hiring somebody else to do something for you, you may need to factor in sales taxes too.
If you do everything yourself, it’s all tax free.
One other point worth mentioning is that even if you make $24/hour at work, are you really going to earn $24 more if you spend an extra hour at work instead of mowing your lawn? For me, I’m on a salary. Any work I do above and beyond means I’m working for free. So, it’s not like I can work an extra hour at work at say, $24/hour, to save 1 hour from not mowing the lawn ($15) and then pocket the difference.