When You Should Spend Money to Save Time
Now more than ever, people value their time more than their money in many instances.
Which makes sense, right? After all, you can always make more money, but you can never create more time.
Over the last handful of years, during which I learned how to make money and optimize my time at will, I’ve created two basic principles to determine when I should spend money to save time.
When your time is worth more than your money
Once you know the value of your time, you can make more sound decisions with regard to your time and money.
My rule of thumb is: You should spend money to save time when the cost of your investment is lesser than the value of your time.
Examples include:
Cleaning your home versus hiring someone to do it for you
Let’s say it takes you two hours to clean your home, and your time is worth $75 per hour. Let’s also say it will cost you $100 to hire someone to do it for you. Since you’ll save $150 worth of your time, while spending $100, it pays to hire this someone.
Doing laundry versus outsourcing it to a laundry service
Let’s say it takes you 90 minutes to do laundry, and your time is worth $45 per hour. Let’s also say it will cost you $45 to outsource it to a laundry service, including pick-up and delivery. Since you’ll save $67.50 worth of your time, while spending $45, it pays to outsource your laundry.
Cooking your own meals versus buying them from a meal preparation service
Let’s say it takes you three hours to prepare three meals (including shopping for the food), and your time is worth $25 per hour. Let’s also say it will cost you $13 per meal to use a meal-preparation service. Since you’ll save $75 worth of your time, while spending $39 for three meals, it pays to use such a service.
Using a ride-sharing service (e.g. Uber) to arrive somewhere sooner versus using a slower method of transportation (e.g. bus, train, bicycle)
Let’s say a ride-sharing service will save you 25 minutes in each direction, for a total of 50 minutes, and your time is worth $17.50 per hour. Let’s also say it will cost you $30 for this roundtrip. In this case, it doesn’t pay to use the service, since you’ll save $14.50 worth of your time, but you’ll spend $30 for the roundtrip.
When your happiness is at stake
To me, happiness is the superior metric of a life well-lived. And a life well-lived is balanced between your professional life (how you make money) and your personal life (your lifestyle).
This is to say, the more balance you can achieve, the happier you’re likely to become.
Easier said than done, Josh. There isn’t enough time in the day to work, exercise, make home-cooked meals, spend time with family and friends, pursue my hobbies, and consume media (e.g. TV, books) on a consistent basis.
Actually, there is enough time in the day to find an equilibrium between your professional life and your personal life, if you develop and consistently exploit habits and skills, such as:
- Vertical Planning (habit)
- Deep Work (skill)
- The Eisenhower Matrix (habit and skill)
- Minimizing cell phone usage (habit)
As Seneca used to say:
“It’s not that we have little time, but more that we waste a good deal of it.”
In practical terms, if using a ride-sharing service will save you 20 minutes, use the ride-sharing service. These 20 minutes will allow you to achieve more balance (e.g. 20 more minutes of exercise, 20 more minutes of TV or reading, 20 more minutes of time with family and friends, 20 more minutes of enjoying a hobby).
If hiring someone to clean your home will save you an hour, hire that someone, assuming you use this hour to achieve more balance between your personal and professional lives.
If using a meal-preparation service will save you … okay, you get the point.
There is, however, one condition: You should only spend money to save time when you own this money; that is, when you’re not using a credit card or some other type of loan. Otherwise, you’ll pay for it in the long-run. (Trust me, I learned this lesson the incredibly hard way.)
At the end of the day — no pun intended — the difference between surviving and thriving is doing what you need to do every day, versus what you want to do every day. This is why I created Hack My Time: to move you closer to doing everything you want to do, not just everything you need to do.
As Robert Zimmerman (aka Bob Dylan) said:
“A man is a success if he gets up in the morning and gets to bed at night, and in between he does what he wants to do.”
There’s more where that came from at Hack My Time.
