Paying with Your Time, can sometimes be a lot more expensive than Paying with Your Money

What is your most limited resource?

Answer: Time

All of us get just a hundred years to live. We have already used a significant part of that. A third of the remaining time we have, we will sleep away

That makes time our most precious resource, by far

The Most Limited and Precious Resource we have is Our Time

When we are comparing our time and our money, we tend to greatly over value money, and greatly under estimate the value of our time. We should be doing the opposite

  1. You can always spend time to generate money
    1. No amount of money can give you back time
  2. Money can be generated in a wide variety of ways. You can invest. You can build a revenue stream. You can work for money, and in lots of different jobs and occupations
    1. Time cannot be generated in any way, other than the natural 24 hours each of us gets each day
  3. Every person on the planet, from Bill Gates to you, gets the exact same amount of time
  4. Decisions on where to invest your time are absolutely critical
    1. If we invest money into the wrong area, or into the wrong product, we can step away relatively easily
    2. While there is some ‘sunken cost fallacy’, you do have the recognition that ‘you should not throw good money after bad money’
    3. If we have invested time, it is almost impossible for people to walk away
      1. We see this in relationships where people will waste another 3 years in a bad relationship, because they cannot walk away from the 5 years of time invested in the relationship
      2. We see the same in jobs and careers, where people continue with a bad career choice because they feel that the time they have invested in their career so far, would go to waste if they left
  5. We make time decisions without much thought at all
    1. Many of us will spend weeks or months deciding what car to buy
    2. While we took only a few hours to a few days to decide what job to take or what career to pursue

This imbalance in how we value money and time leads to a lot of wrong decisions

Perhaps one of the biggest is …

We often chase ‘Saving Money’ at the cost of ‘Spending our Time’

Let’s consider a few decisions. What choice would you make?

  1. Would you spend a weekend fixing your bathroom plumbing yourself, to save the $200 you would have to pay a plumber?
  2. Would you drive for 3 hours to pick up an item from a shop, to save $10 in shipping costs?
  3. Would you spend a day trying to fix the fridge yourself, to save $150 you would have to pay an electrician?

Many of these decisions are obvious ones. You probably don’t have the specialized skills and tools required to fix a refrigerator yourself or to fix the bathroom plumbing yourself

The driving for 3 hours decision is perhaps the easiest. The cost of you spending 3 hours, and the wear and tear on your car, is easily worth more than $10

Authors and Publishers, however, will make several such decisions when it comes to their books. They will chase ‘Saving Money’ at the cost of Spending Time that is far more precious

  1. An author will spend 20 to 40 hours of their time editing their book themselves, not be able to do even half as good a job as a professional editor would do, and yet think they have saved $500 to $1,000 on editing costs
    1. Firstly, if the book is half as polished, you will lose a lot more than $500 to $1,000 in lost book sales
    2. Secondly, if you make $20 an hour (most of us perhaps make more than that), then 20 to 40 hours of your time is already $400 to $800. Your savings are miniscule
    3. Thirdly, that time has an Opportunity Cost
      1. You could be doing market research to find a great market. If successful, that would be worth a lot more than $500 to $1,000
      2. You could be writing a book. If successful, that too would be worth more than $500 to $1,000
  2. An Author will waste countless hours writing a book inefficiently on their existing word processor, such as Microsoft Word
    1. Even though, for just $40 to $100, the author could get a dedicated book writing software and be a lot more productive
    2. Sometimes, an author is reducing their productivity by 50% to 75%, just to save that $40 to $100
  3. An Author will spend 5 hours learning Photoshop, and then another 5 to 10 hours making a cover that kills book sales
    1. Even though, for $30 to $500, the author could get a world class cover that increases book sales, from a professional cover designer

Authors constantly make decisions where they

  1. Undervalue their time massively
  2. Overvalue money
  3. Ignore that they cannot at first attempt (or even at 20th attempt) do work as good as professionals who have 10 to 40 years of experience

We are all guilty of this. We massively overestimate the value of money, and ignore the extreme importance of our time

Paying with Your Time is often more expensive than Paying with Your Money

The scenarios where ‘paying with your time’ is better than ‘paying with your money’, are actually somewhat limited

  1. If there is something which is your core competency, then obviously you will in most cases be better off doing it yourself
  2. If something requires the absolute best work, and you are skilled at that work, then it is best to do it yourself
  3. If some thing is very expensive, and your time value is much less than what it would cost, then you might not have a choice

On the other hand, scenarios where ‘paying with your money’ is better than ‘paying with your time’, occur much more frequently

  1. Almost any area where you do not have expertise, you are better off letting the experts handle it
    1. Even areas where you do not have basic competence, you are usually better off letting the experts handle the work
  2. Any task that is time intensive, should be handed to someone else
    1. Unless your time has absolutely zero value, you should not be doing time intensive tasks yourself
  3. Any area where people have specialized in doing things faster and cheaper than what you can manage, you should definitely hand things off to them
  4. Any area that takes a long time to learn, and you would pay not only for the ‘time to do the task’, but also for the ‘time to learn how to do to the task’, you should seriously consider paying someone to do it instead
  5. Any area that you hate to do, you are better off having someone else do it. This is especially true if it can be done cheaply by someone else

Paying with Your Time is something to be carefully considered. You should only be ‘paying with your time’ when it makes sense to do so. Most of the time, it does not

Concluding Thoughts – The Value of Our Time is far higher than we realize

We (all of us) are guilty of undervaluing our time

We tend to think of time as infinite and money as finite, whereas time is very finite. Money, on the other hand, can be earned in a variety of ways

We also tend to ignore that it is only in areas where we are competent (and which we enjoy to do) that it makes sense to do tasks ourselves. In most other scenarios, it is better to pay someone to do the work. We should use our limited and precious time for things which we are specialists in, and for things we love to do. Preferably both

Leave a Reply

Your email address will not be published. Required fields are marked *