Time is Money and Its Way More Expensive Than You Would Think Reevaluating your relationship with time and understanding its real value might kickstart your most productive streak yet.
By Patrick Frank Edited by Micah Zimmerman
Opinions expressed by Entrepreneur contributors are their own.
How many times have you heard the phrase "time is money?" Or some version of the statement: "time is the most valuable thing in the world?"
Have you ever stopped to think about what those statements mean? And if they are authentic, why do so many of us still waste so much time doing things that aren't necessarily valuable?
Every second counts when you are an entrepreneur, and it always feels like there is never enough time in the day. The world is moving faster than ever, and our attention is needed in several places at once. We have to be more protective of our time than ever before. We have already seen this start with actions like skipping preliminary company meetings, setting boundaries in our work hours, or just using our free time more productively.
Again: Every. Second. Counts.
The price of time
Have you ever actually thought about the value of your time? Better yet, how would you change your daily habits if you knew how much it was worth? You can break it down like many things into a simple equation.
Let's start with the basics and work through an example.
You have two types of time: productive and leisure.
To understand productive time, let's say hypothetically that your salary is $100,000 (anything over this would put you in approximately the top 24% of earners in the US). Then let's take the average amount of hours worked in a year at 2,080 — roughly 40 hours for the 52 weeks of the year, excluding vacations, sick days, etc. In this scenario, you are worth $48 per hour.
Now you want to set yourself a future goal — let's say to be 150% further along in life than you currently are. So we apply a multiplier of 1.5x, which gets us to $72 per hour. This is your productive time.
And then there's leisure time. No matter how hard we try, we cannot be productive 100% of the time. So we have to account for leisure time as well. Think of this as any time you are relaxing or not moving forward in your earning potential. Using the same equation, we discount our time by 40%, which puts us at $29 per hour.
Real-life examples
Still with me? Let's look at some real-life scenarios to put this into perspective.
Productive time
We all have those meetings on our calendar that we dread going to and deem a "waste of time." Well, how do you know? Typically those meetings already have too many people in them. Let's assume that seven attendees earn $100,000 a year. That hour-long meeting is costing the company $504. If you don't think the discussion is worth it, I couldn't think of a better way to convince management that it costs the company more to hold it.
Leisure time
Have you ever watched the entire season of a popular show? Let's take "Game Of Thrones," for example. Using our equation, if we counted this as our leisure time, the total GOT length to watch is roughly 71 hours. Using our leisure time calculation means managing the entire show would cost us $2,100. Whereas, if we used this time towards productive means, the total value would reach a whopping $5,112.
Related: 5 Ways to Make More Time for Your Small Business
It's a wake-up call to see numbers presented in this way. If a friend insisted you had to watch a fantastic new show, but the cost would be $5,000, would you do it?
The only thing that has changed in this scenario is that someone has forced you to place a monetary value on the activity. Once you can train your brain to see the matter, that's when you experience a turning point. So how can you turn the cost of spending into investment in growth?
Its time to change our perspective
So often, people think, "I want to do more with my life, " or "am I reaching my potential right now?" We challenge ourselves with these questions, but the answers are always hard to find. We struggle to find a way to associate these thoughts with measurable actions.
When we can attach a price to something, it inherently has more value than something without a fee. The old saying goes, "Price is what you pay; value is what you get." Without a price, one could assume that the value is zero.
Ultimately, when we can see the financial value of time, the more expensive, it becomes, which leads to more profound attention to how you use it. I became so obsessed with this idea that I created software for myself that calculates the value of my time and applies this to everything in my personal and professional calendar. Do I recommend this to everyone? Not necessarily, but I do recommend finding your balance. After all, no two people are exactly alike, and no two people can fix the same amount of worth to their time.
Don't optimize, prioritize
If you think that this all sounds a bit overwhelming, don't fret. Life can't be all business, and you have to allow space for joy in life's unexpected moments. It's essential to spend time for yourself outside of growth and productivity since being too selfish with your time risks you missing out on life's most precious memories.
Trying to plan every last minute of your day is a common pitfall, which some might describe as toxic productivity. While a date night might cost a lot more now, what happens if that date is your future spouse who multiplies your time in the future fourfold because you are now the happiest person alive?
In a similar way, what about that recurring meeting? Yes, it might be expensive, but maybe it generated an idea that could drastically alter the company's direction. Life is about making the decisions that feel right at the moment. You cannot continually optimize, but you can start to prioritize where the actual value is.
Related: Time Management Hacks That Very Successful People Practice Daily
Make the change
When was the last time you watched a TV show, spent hours on a video game, or binged an entire season on Netflix? Probably recently, right? Then ask yourself again, when was the last time you said: "I wish I had the time?" Again, probably recently.
But ask yourself this: what could be different if I not only started thinking about time as having value but what if the world did? Just imagine how many new technological innovations we would see. Imagine a more productive, healthier society.
Just like anything, a life change must begin with a new habit. It's hard to start, but repetition makes everything easier, instead of just a few people in a room who think about value and productivity. Ripples can become tidal waves. We can make meaningful differences in our lives and the world around us by resetting our relationship with time.
Remember, time is money, and there is nothing more valuable than time. It's time we started treating it that way.
