How Much Money Is Your Time Really Worth?

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alarm clock with coins isolated ...
Shutterstock/Africa Studio
By AJ Smith

We are all busy. Everyone is looking to save both time and money. The big question is when it's worth it to swap one for the other.

A few years ago, I found myself very busy at work. During my precious hours at home, I wanted to be able to relax. While I had always enjoyed the satisfaction of cleaning, it was starting to become a hated chore. So I hired a cleaning company to come to my apartment once a month. At first I thought it was great -- after working my four eight-hour shifts over two days I loved coming home to see the carpet freshly vacuumed and the bathroom sparkling. But soon I began to resent the money I was spending.

I had to spend time de-cluttering before the cleaners came and often found myself re-cleaning areas not done to my (admittedly neurotic) standards. I wasn't spending my added time with friends or sleeping -- I was mostly watching mindless TV on the couch. Plus, it turns out vacuuming can be a good stress-reliever that I was actually missing. I resumed cleaning my apartment and used the money savings to fund a future weekend getaway. The added bonus was I had something to look forward to and dream about during those long work shifts!

Some people consider it a huge waste of money to pay someone to clean your home when you could do it yourself. Others feel the time they gain to spend on family, friends, work or hobbies makes the expense worth it. For me, it wasn't worth it. But for someone else, it might be.

Is It Worth Driving for Cheap Gas?

The average adult earns $42,700 per year. That's about $21 an hour if you crunch the numbers. Depending on where you live, your education and your profession, you may make more or less. So, one way to figure out whether a convenience is worth it is to calculate your hourly wage and price out the cost of doing certain activities. Now, assume that's what your time is worth (after all that's what you are valuing your time at by accepting that salary).

Be sure to factor in the value of your time when assessing whether something is a bargain. For example, people often try to find the cheapest gas station to fill up their tank. But sometimes it's just not worth it.

Consider that a gas station close to your house is charging 15 cents less per gallon than one 10 minutes away. If you have a 15-gallon tank you are saving $2.25. But you also spent 20 minutes - and some gas - driving to and from the gas station. If your time is valued at $21 per hour, 20 minutes is worth $7. That easily erases the $2.25 in savings. In fact, it's as if you are paying 31 cents more per gallon than you would at the closer gas station (this example also assumes you could be earning instead of going to the gas station).

A bargain should be where you think you are getting a good deal even when you consider what your time is worth. So it might be worth it to go to that gas station if it is on the way to or from work or if you have other errands in the area.

The important thing is to consider all of the factors that go into the cost of an item, including your time. Not all efforts to save money are created equal. You have to figure out which ones are worth it to you -- and when it's time to pick that vacuum cleaner back up.

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9 Comments

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vlady1000

So instead of fixing something around the house after work, I should call a repairman instead as I make more at my job than I pay him per hour.........and sit on my butt watching TV as he fixes it? Makes sense

February 27 2014 at 10:48 PM Report abuse rate up rate down Reply
abourge458

My Rolex is worth about $4500.
OOps, never mind. I think I misunderstood the question.

February 27 2014 at 5:39 PM Report abuse rate up rate down Reply
Sheila

I know of very few people in this country making 21 dollars an hour. The wealthy own the money,not the masses.

February 27 2014 at 1:54 PM Report abuse rate up rate down Reply
kcanpa2_kenneth

Wow, I make about $16,000 a year and still don't have time to clean my house and still cannot afford gas. I wish minimum wage was better. But then again, there have to be lots of low wages to balance the high salaries to make the numbers look good.

February 27 2014 at 10:07 AM Report abuse rate up rate down Reply
nwndotcom

This is nonsense. Your time is worth NOTHING if you're not WORKING.

February 27 2014 at 9:53 AM Report abuse rate up rate down Reply
Dtwoster

When it comes to trying to call any customer service department it is obvious your time isn't worth anything. They will leave you on hold for hours at a time.

February 27 2014 at 8:31 AM Report abuse rate up rate down Reply
IN MY OPINION ONLY

Yawn...

February 27 2014 at 3:17 AM Report abuse rate up rate down Reply
sterlingdt

I think the author's time is better spent proof-checking their work. The gas station analogy was backwards. :)

February 26 2014 at 11:33 PM Report abuse +1 rate up rate down Reply
1 reply to sterlingdt's comment
alfredschrader

Yeah it was sterli, but I still got the idea. You know, over the years some big names in science have made similar blunders - we are all human. But here is one I never expected.

A lot of people think that eventually cold fusion will be made to work and have invested billions in it. Just out of curiosity, I went back to take a look at how hot fusion works to get some clues. Woops.
On paper it doesn't work. Something else is occuring. What is supposed to be happening is two Hydrogen atoms "fuse" together into one Helium atom and the difference in mass
results in the release of energy. Supposedly, to achieve this you need the heat and pressure of an atomic device as a trigger. Only, if you apply heat and pressure to Hydrogen atoms, they come apart same as they do in the Large Hadron Collider. They can't combine.
This is what is happening in the H device, not fusing. The traces of Helium tested
are from bits of cooled Hydrogen atoms that combine after the event. I'm not sure if this was a mistake by the scientists, or dis-information to throw off competitors.
I am absolutely certain that you cannot get atoms to combine if you heat them and smash them with high pressure, instead they come apart. I wont tell you how I know this because it's proprietary, you have to trust me on this.

February 27 2014 at 6:55 AM Report abuse rate up rate down Reply