We’ve all noticed that there exits a relationship between time and money. Teens learn quickly that society puts a price tag on their time starting at a minimum wage. Depending on the location, additional skills, the industry, and several other variables this minimum wage might differ. At any rate, one hours work might afford them one hamburger at the restaurant, or one movie ticket at the theater, etc.
This illustrates very well that things have an intrinsic value. The hamburger is sold for the price it is because of what it is made of and the cost of the time invested making it into it’s final consumable state plus or minus market factors like supply and demand as well as customer perceived value and so on. However, even though this is the price tag, the price goes beyond that for the consumer because he too must invest the time and other costs to attain the item. I’ve noticed that as time becomes more and more of an valuable to the consumer, then the intrinsic value of any item becomes less important and the cost of acquisition. Expecially when we consider that acquisition includes in many cases travel, decision making, the transaction, consuming or using, and in other cases possessing and maintenance.
So as time becomes more and more valuable to an individual the cost of items to that individual goes up as well and there is only one way to stop the cost from growing. The individual must break the time and money connection. Time cannot be so intimately tied to the amount of money the individual can make thereby determining the amount of items he can acquire. I know of two ways to do this.
The first way to adjust the dependence on time and money is to become educated and skilled in the work that you do. This makes it possible for you to accomblish things faster and to be sought after for what you do. This however only changes the slope of the time value curve. It is what makes the price that you pay for an item like a burger nearly irrelevant to the rest of the time that you spend with that transaction.
There is only one way to break the time value curve and that is to leverage people who have a lower time to money value than you do. For example if a task needs to be done and someone else can do it as good as you for less than your cost of you doing it yourself then do it. Even if they can do it in half the time or twice as long. As long as they can do it as good as you need it done for less than it would have cost you to do it yourself. This is a great justification for having a home cleaning service. If a family maintains the order and organization then it could easily be justified that spending the 2-4 hours on a saturday deep cleaning the home is not worth the price tag of a cleaning crew even if they can do it in 1 hour as long as the price you pay the cleaning crew is less then the total cost to do it yourself. A generic consumer price equation might look like
benefits of having service or item + time saved by not doing it ourselves + other benefits doing things that couldnt be done without it or because it took the pace of – tag price paid – other costs associated with getting – opportunities lost by having = cost to the individual
If the cost is negative then it is always a good idea to get that item or service. If it isn’t a good idea but it is still negative then you aren’t including all the benefits or disadvantages or maybe you are incorrectly valuing your time. For the cleaning example, many families, mine included, find that if we choose to have a cleaning service the cost for cleaning would be too great because we would miss the opportunities to teach our children the value of hard work and we also might have a disconnect from the impact of our actions.
Unfortunately this can be taken to the extreme. For example how do you value your relaxation time? and is time spent with some people more valuable then spent with others? Time at work vs time at home? And ultimately now you’ll have to decide if thinking about this topic and reading this post was even worth your time? Your input, references, and extended evaluation of this topic is important to me and part of the reason that I wrote the post at all however, you’ll have to ask yourself, what value do you place on submitting a comment below?
Update: a really good article http://www.fourhourworkweek.com/blog/2009/04/24/on-the-shortness-of-life-an-introduction-to-seneca/