I have referred to in previous posts about the relationship time has to money, as the popular saying “Time is Money” says. The relationship with time and money is essential because pretty much dollar earned is with some kind of time investment. This is the case whether you work hourly, paid in salary, paid commission, even passive income is based on time spent at some time. Obviously, not every dollar is earned with the equal amount of time. Examples of when you spending money to save time are hiring someone to clean your house, paying for shipping, paying a delivery charge for food or groceries. There are steps to determine when it is a good time to spend money to save time.
- Determine Your hourly rate: It is easy to determine how much you earn per hour when you are paid hourly; however, determining that with other incomes can be tricky. This can be discussed in more detail in a later post on how to calculate what your actual hourly rate is, because it can be tricky and is up to you on how much detail you want to go into to determine. Once you have either an hourly rate or amount to work with that is at least a good estimate, you can move on to the next step.
- Find out how much time you actually have. Use the method the that works best for you to do this. Personally, I recommend using a time tracker to track your actual time, and some sort of system to also keep a time budget. Using aTimeLogger, an app found in both iOS and Android, you can track all of your time and set up goals to either limit amount of time or to reach a certain point that you are reaching for.
- Find out how much money you actually have. Keeping a financial budget is very crucial as well, and more commonly practiced. Just like a good time budget, a financial budget is built the same way, with actual being tracked accurately and completely and have a way to compare budget to actual. There are countless tools for this, so use whatever works best whether it’s a computer program, an app, Microsoft Excel, pen and paper, envelope method, coin jars, etc. The best system is the one that you find most easy to access and realize how much money you actually have.
- Determine priorities. The step to knowing when you should spend money to save time is knowing your current situation. For example, do you find yourself not having enough time to clean your home? If that is the case, then the next thing to look at is your money. Do you have money that you are willing to spend to have this done so you can have more time for other things you need to and want to do. This method works in business as well and personal life. Taking an inventory of both your time and money and looking at them together is essential to realizing if it is worth it to outsource your activity to someone else to do.
- Make a decision and act on it. Your last step is to make the decision. Hire the extra person for your business, or pay someone to clean your house, or decide to shop from home rather than going to the store. Also take note, that most decisions are reversible and can be reassessed later on to see if the decision is still valid and necessary to change.
Remember that time is limited, you cannot make any more of it. Everyone gets the same amount of time in a day, you can’t inherit time or win the time lottery. Money is different, you can create more of it per the amount of time you spend on it (i.e per hour, per year). Since you can’t create time, you can “buy” time by paying for things that save you time.