How Much is Your Time Actually Worth?

Your time is valuable’. A phrase often said to clients and prospects. But what meaning does this really hold without a tangible form of measurement? How valuable is it?

There are a lot of valuable resources online that help give you back your time (Trello, FlyCleaners,TaskRabbit, Mimeo – self-plug, yet truthful…). Lately, however, there has been a shift in better understanding how much, down to the minute, your time is actually worth. This matters because it allows for better informed purchasing decisions and time allocation – even when those decisions may not be so obvious.

how-much-is-your-time-actually-worth-imageHow do you calculate the trade off? Here’s an extreme example.

If Bill Gates spent time picking up a $100 bill he dropped, it would cause him to lose money.

According to Mic News, Gates makes an estimated $114.16 every second he is alive. Even assuming that picking it up took 3 seconds, this would result in a $242.48 loss for Gates when losing 3 seconds of his time. (When asked about this, Gates said he would, however, pick it up and give it to the Gates Foundation in a Reddit AMA.)

This, of course, is based on the assumption that those three seconds could have been utilised in a more productive manner while at work. Picking up the money would diminish the value of his time if it replaced a meeting, yet would prove profitable if it replaced 3 seconds of sleep. Happiness, interests, and impact on work quality are all additional aspects that need to be incorporated in determining the overall trade off.

In a less extreme example, Spencer Greenberg, founder of ClearerThinking.org, watched his friend who makes over $100,000 a year “wracking her brain trying to figure out how to use a $20 gift certificate,” he says. “She essentially lost more value just making that decision than the value of the gift certificate.”

There’s no cents (pun intended) in a knowledge worker assembling binders at their desk.

This realisation prompted Greenberg to create a calculating tool on Clearer Thinking to better determine what trade-offs should be made and when. You simply enter your income, work hours, and responses to questions that determine how and why you value your time. Then, with the results, it calculates the overall consistencies – or inconsistencies – in your decision making.

This tool can be used to figure out the optimum trade-offs, allowing yourself to free up additional time, more adequately delegate specific tasks and responsibilities within your workplace, and begin eliminating those that don’t add value. It also shows how your decision-making stacks up to those of other calculator respondents.

The next time that it takes you an extra hour to save a few dollars by driving to the cheaper grocery store (or you contemplate assembling documents at your desk to “cut spending”), the tangible cost of something per unit price is not the only factor that should influence purchasing and time allocation decisions. The delegation of your time – and value of it – often outweighs costs that are more obvious in nature.


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