Do You Value Your Time Or Your Money More?
A guest post by Erica Douglass, on Get Rich Slowly has caused a great stir in the personal finance blogosphere. I’m sure readers were expecting the typical post of how to save more money by skipping that extra latte from Starbucks. Instead they got more than what they paid for (which was nothing). After all, most personal finance blogs discuss the same mundane things you might see discussed with “The Oracle of Berkeley” – Suze Orman. It’s the typical mantra – get out of debt, live frugally, make sure you save, and have an emergency fund. You get the idea. It’s the basic stuff that should have been taught in school, but wasn’t. What if you have all done all of the right things, what’s next? Is it possible (gasp) that people have followed their good advice (with some bad) and now past that point? This was one of the reasons I created the blog. Most of the personal finance blogs discuss the same things, but rehashed a different way. After all, personal finance is not rocket science. Spend less than you earn, and invest the difference. Erica’s guest post is somewhat out the box, and discusses what seems to be a taboo subject to most. Assuming you have some level of financial success, how can you start using this to your advantage? Her post discusses outsourcing tasks to others. I think the people objecting to her post, more than likely are employees, and never owned a business. I saw posts more or less stating, is she too lazy to do the “common man” tasks herself? In addition, how dare she hire someone outside of the US. After all, there are good people unemployed in the United States.
Being a business owner, I looked at this post much differently than the negative commentators. I saw it as she had enough of a savings cushion to allow her to become super focused on the things that she likes to do. By allowing someone else (who also might be better than she is) do the task, it frees up her time to focus on other things. The free time could be used productively to increase her income even more. The money from the sale of her business has allowed her some financial freedom. After all isn’t that the purpose of becoming wealthy? Why else would people be reading a blog named “Get Rich Slowly”?
While not everyone is equal in society – some come from a rich family, others have a better education, some came from better neighborhoods, and some are more lucky than you. We are all equal in one thing. We all have the same amount of time each day. What we decide to focus on determines how successful we are with the goals we set. If you already own a business, I don’t have to tell you it’s not a 9-5 job! You understand you have other things outside of your business – a family to take care of, a house that needs to be maintained, and errands to run. There are only so many hours in a day.
With my family, we have quite a few people that assist us with our daily living. I’ll mention the obvious ones that only twenty years ago were considered “luxuries” to most. We have daycare, a cleaning lady, and lawn service. Even other things most don’t even flinch at, we are technically outsourcing to others: getting my hair cut, getting the car’s oil changed, having my accountant do our taxes, etc. etc. etc… I could technically do all of them myself, but I choose not to. Why not? It’s because I value my time, more than the money to have someone else do it. It’s a decision I deal with as a business owner on a daily basis. Some of the questions I ask when doing a task:
- Should I do this, or is someone else better suited to do this work?
- Do I have the time to perform a knowledge transfer and offload the work to someone else?
- Can I find someone else to do the work who will do it better than me, and at the same time are they cheaper?
- If I do have someone else do the work do I have the budget for this?
- Could I be doing something else that’s more productive with my time?
What applies to business, I also believe can apply to your personal life.
The thing is, when you have little money, and more time, the choice is obvious. You will do it yourself, because you have no choice. I suspect the personal finance bloggers that post ways to save money by doing “X task” yourself, have more time than money. That’s not to say you should never do something yourself, or at least understand what it takes to do it. While I feel it’s important we have a clean house, and have done it many times previously, we choose to hire someone to make sure it’s clean. We can then focus our time to do something else more productive. It’s as simple as that, nothing more or less. I value my time more than the money it costs to have someone do the work.
Readers, which do you value more, your time or your money? What tasks would you never let someone else do and why?
Created: Thursday, 11 February 2010 09:02 Last Updated: Friday, 12 February 2010 02:17 Written by: Investor Junkie
Hey I found your site from that post actually and liked your comment.
Like you said, if the person has little money but lots of time, the choice is very obvious.
I strongly believe that people who are into reading "how to get out of debt" or "How to start saving" will not choose time over money. Lack of money is a painful situation and time is free, relatively speaking.
However, for a business owner or someone who has made a lot of money, experiences tell them that TIME IS MONEY.
For me, I enjoy vacuuming the house so I do it. But if I were to hate the task, I'd be more than happy to hire someone to do it. After all, my hourly rate is a lot more than $30.
Those with the employee mindset (granted I am a W2 for now) will never understand it. You won't change them with a 500 word blog post, nor is it worth your valuable (or Erica's VERY valuable) time. What you can do is try to help someone that is on the fence.
"Most of the personal finance blogs discuss the same things, but rehashed a different way. After all, personal finance is not rocket science. Spend less than you earn, and invest the difference. "
I think that was the most frustrating thing when I started reading personal finances about 2 or 3 years ago. To get away from that is the reason I started my blog and the reason we share a lot of the same blogroll.
Hi KittyBoarder: Thanks for visiting. I believe it was discussed in the book "The 4-Hour Workweek" about what the average hourly rate a person typically is worth. It's around $20-30/hour. I've also seen this stat mentioned other places. Meaning if you are doing something that generates more income, you are better off hiring someone else to do the other task that costs less. This is strictly from a monetary aspect only. Of course if you like doing something, then understand that's the reason you are doing. Not kidding yourself you are doing it to "save money".
I can’t really make a blanket statement about which I value more, my time or my money, because it depends on the situation. Of course if I had to make one choice for the rest of my life, my time would be more valuable. While I desperately ought to outsource cleaning our house, since none of us are doing it as often as we should, I’m having trouble pulling the trigger on that one.
I think it comes down to a cost-benefit analysis for each situation, plus an aggravation factor. As an example, I was spending about 5 hours a week doing something for my business that I wasn’t very good at and was slow at. So I paid a VA in the Philippines to do those tasks. I did feel a pang at how low the rate he asked for was, but in truth that’s all I could afford to pay. Freeing up those 5 hours a week made an enormous difference in my life. I hope the pay helped the VA out as well. I read the comments on Erica’s article and wondered how many people gasping In outrage at $3ish per hour had ever tried to hire someone in the US to work one hour a week at minimum wage (my other alternative). I tried to pay a few teens here to do the work and they were not
interested in the task.
Hey Evan, my goal isn't to convince the poo-poo-ers on the subject. There will always be people who think entrepreneurs and business owners are "evil". It seems even more so in the political environment we are in. That's their mind-set, then so be it. Fact of the matter an employee never works for a poor person (unless they work for the government). I don't bitch about it, I just accept it as fact and work around the situation. Similar to the issue life isn't fair. Never has and never will be.
Instead of bitching about it they should take action on something (start their own biz, quit and work for someone else,etc.). But alas, bitching is what most people will ever do. I also find it quite ironic, that people are threatening to quit reading JD's blog because of one post. Keep in mind, they pay how much to read it??? Ah that's right, it's free! You got exactly how much you put into it, nothing!
Granted Erica's post could be worded slightly better. There are some emotional issues I can see she has tied to money, but that's a different issue and subject. The overall purpose of the post is sound and solid. It should be looked towards as good ideas, instead of looked at in a bad way.
From my experience there is definitely a different thought process between an employee and business owner (rightly or wrongly). The comments on GRS prove exactly my point.
"I tried to pay a few teens here to do the work and they were not interested in the task." Yea I have seen this issue also, not sure of the entitlement factor, or something else going on. I'm obviously not making the blanket statement "all young people are lazy", because I know of a few older people too
I do remember though, when I myself was in my teens how I would bust my butt trying to do the best job possible. No matter what. Regardless of how crappy I thought the job was. After all you don't start at the top! Which I wonder is what some younger people are expecting say just out of college.
Let me also add, if your goal is to become your own boss use the opportunity you have where you work to advantage! It's not often people have access to a large pool of high net worth people like you do. Network with them as much as possible. Find out what makes them tick. Learn from their successes and failures.
I think the people objecting to her post, more than likely are employees, and never owned a business." I think you need to widen your assumptions. I was one of the pro-Erica commenters in the original article. I am an employee. The reason I can relate to Erica's point-of-view is that I am relatively well off (I'm 35 and have a net-worth of a little over half a million). For me, getting rich is not just a pipe dream that might happen someday, but it's tangible and very achievable in the near future. I want to know what challenges I will face once I retire with a large nest egg and say: "what now?". I came to the same conclusion as Erica regarding outsourcing unpleasant tasks. But it had nothing to do with freeing up my time to spend more effectively on business-related things so that I can be more productive. For an employee like me, that extra hour is simply spent playing with my child, reading a book, spending time with family, or otherwise relaxing. I don't feel any need to take the "gain" of that hour and plug it right back into the rat-race. I'll enjoy it right now, guilt-free, thanks very much.
Hi Alexandra. Thanks for visiting. I'm not saying all positive comments couldn't be employees either. More the reverse, any negative comments more than likely at not business owners. Of course, I'm making a generalization with either side. Like any generalization, there are always exceptions to the rules. Cheers!
Gonna have to go with time, hands down. Really hard to connect with a lot of the sentiments of "101 ways to save a nickel on your way to the store, or 8 ways to frugally ride your bicycle to work". You could've made more money working on your business (online or not) than reading an article that is common sense and is empty calories. Hopefully I'm not being a hypocrite there.
I wasn't a big fan of the us versus them statements used in the comments of her article. Reminds me of the south park episode "They took er jobs!" The world is becoming more of a global community and generalizations such as those make Americans look like idiots.
"I wasn't a big fan of the us versus them statements used in the comments of her article."
That was done on purpose, and if she took this from Frank Kern's material stating to do this.
Wonderful to read!