5 Ways We Devalue Our Time (and Potential Earnings)
Are you a nice person?
Does the idea of saying ‘no’ kill you softly from the inside?
Do the neighbors always ask you to walk their dogs?
Are you always running around helping others?
Well, if you answered ‘yes’ or ‘maybe’ to even half of the questions above, congratulations, you just lost $150 (or more)!
Ok, before you start rolling your eyes and waving your fist in the air (because you are so mad, and because you can’t stand the truth), hear me out. While it is awesome of you to be the kind of person who loves helping around and is passionate about making this world a better place, it begs to be noted that if in doing so you are losing money, then you are not helping anyone. And I get it, not every situation warrants you to be thinking about money, and that some instances require you to go out of your way to help someone.
But, I am talking to the small business owners/entrepreneurs/go-getters, who regularly disrupt their schedule, their disciplined routine because they want to be that person on the other end of the call, pacifying their friend for the nth-time that it is ok to forget her ex.
And, the interesting part, these acts of generosity happen without much conscious effort, and that is a huge issue. So, what do we do? Become aware of these acts, simple. As we start observing how our days are being spent, how far we have come along on our goal achievement or how we feel after jump starting that car at the expense of making a client call, we get closer at being conscious in our decision making.
It begs to described why we make these trade-offs in the first place, and top three reasons come to mind:
Uninspired in our business/work/practice – since there is nothing that is exciting our joints, we feel useful and busier taking on chores unrelated to our business
Inherent lack of self-discipline – enough said!
FOMO – basically, feeling the sting of not being involved in someone’s life and therefore, assuming that we are missing out on the new developments, updates and happenings
So, once we become aware of what is actually causing us to be that SUPER HERO HELPER, we then need to understand the ways we devalue our time and hence, the scope of potential earnings.
As small business owners/empire builders/girlbosses/in-transitioners from cubicle to start-up, we often neglect to estimate our time. I mean the thinking goes like, hey, since I haven’t made a major breakthrough yet and I still have some time, why not take a little break to drop off that prescription for my uncle. (Rating: $$$$$)
We socialize wayyy too much and disguise it as “networking for business”. Ever caught yourself perusing endless Instagram feed or the need to be one of the 2,222 commenters on a social media post? Yup, you know what I am talking about. (Rating: $$$$)
We take vacations when we should be taking a staycation and ploughing through that marketing pitch. But, Shivika, I need to recharge my batteries, you whine. Sure, but what good is recharging when it won’t longer connect or support any vision. Once a break kicks in, the flow stops and so does the urge to keep going. (Rating: $$$$$)
We constantly peek over the fence and see what our competitors are doing. Comparison should be a crime, really. The number of creative and original bridges it burns is crazy. Stay focused on your product, and while it’s healthy to take a peek once in a while, a full blown obsession is a complete devaluation of time, and takes the fun out of our efforts. (Rating: $$$$$)
We think more than we do. The math is simple on this, less action means less money generated. (Rating: $$$$$$$)
Now, let’s take a quick and easy look on how to calculate the true value of your time.
Normalized value: Total Net Income (income after taxes, expenses and other deductions) ÷ Number of Hours Worked
Example: If your total net income for the year is $65,000 and you worked 2001 hours, then based on the formula above your per hour normalized value is $32.48. If you were to drop down the number of hours it took you to get to the same total net income of $65,000 to, say, 1400 hours then our normalized value goes to $46. Granted, we consider ourselves to be valued much much higher than that, but technically, numerically, this is how the math works out.
But, wait! There is more!
Opportunity Cost – the cost of losing on a potential earning from one activity, when pursuing other activity. Also note, this cost is not restricted to just monetary or financial cost. There is an emotional aspect to it as well, which can be huuuge! (Somewhere in Washington DC, Someone would be proud of me using that word). Nowhere have I seen anyone talk about this cost when valuing our time, and therefore, this is the most critical component that we have to factor. So, say, you are a blogger and you are ready to set up the e-book, but you decided to run that errand to rescue your bestie’s cat – voila! OC in the house, and it could range anywhere from $1-$1000s! Oooh boy.
But wait, there is still more!
I am a big fan of James Clear, and was super excited to find out that he had written a wonderfully detailed post on this very topic. This is super detailed and gets down to all the nitty gritty (reading time: 15 -25 minutes).
As we trudge along the path of wealth creation, doing what we love, we need to be very smart and careful of our time. The path can be full of distractions, and when we put on the perspective that our time is valuable (as in real ka-ching making) then we make sincere/conscious efforts to stop the wastage. Being a frugal prudent here is ok because people who love you, and who want to see you succeed will understand.
To round up, here are simple ways we can ensure that we are valuing our time’s worth and maximizing it:
Become aware of activities/people/situations that take us closer v.s. further away from our goals/tasks/productivity
Put hard stops on the extent of each distraction, and be very upfront and honest about it so that we can set the expectations right
Learn the beautiful art of saying no