The Money/Time fallacy
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The Money/Time fallacy
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Re: The Money/Time fallacy
#2I refuse to peg every remaining second of my existence to the highest hourly rate someone else will pay me for it. I won't say "My time is valued at $XX per hour, so it makes sense to pay $XX for someone else to do this." Valuing all time at an hourly rate is logical if a human is trying to maximize the amount of money made across their life - since you could theoretically pay for this task to be done while working, you would have more money than if you did the task yourself. Maybe you work every waking second.
But I don't. I don't want to.
I want to maximize life enjoyment across my life, not the money earned. Instead, I compare what I'm doing now to what I could be, including consequences, and decide which I'd rather do. Then I do that.
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Not to mention that money has limited utility - you can only trade it for things which currently exist, and which other people are willing to trade. No amount of money will buy you a Star Trek Transporter, nor will it revive dead people or let you live forever. It won't buy you food from the ground; you have to trade it for something else and put that in the ground, and wait a season. Most of what money will buy is boring.
Re: The Money/Time fallacy
#3I refuse to peg every remaining second of my existence to the highest hourly rate someone else will pay me for it. I won't say "My time is valued at $XX per hour, so it makes sense to pay $XX for someone else to do this." Valuing all time at an hourly rate is logical if a human is trying to maximize the amount of money made across their life - since you could theoretically pay for this task to be done while working,…
Eventually, you will come across a situation where you need to decide if you will "work" in your free time (painting your house, mowing your lawn, etc), or if you will pay someone to do this so that you can free up your own time to "maximize life enjoyment". The time = money equation isn't just about always earning money, it's about cost savings & cost avoidance as well.
You have to decide, what makes you happiest? If it is freeing up your time to do something else, then you might even pay a premium to have someone paint your house for you.
Re: The Money/Time fallacy
#4Have to agree...
Further - it's been said before - when it comes to time -vs- money - you can always find a way to make more money if you need it - but what you can't do is make more time - time goes by whether you use it or not. If I have a choice between playing with my kids and turning down some overtime, which pays very well, I'll take spending the day with my kids. That time can't be replaced later. Odds are I can always work more. You get one life of unknown length - choose how you spend your time wisely, not by some simple formula.
Further, if I do want to do consulting work after work, it's certainly about how much I'm going to get paid, but it's also about what hte work is, how interesting it is, who it is for, and what the other network benefits might be. I won't generally work for free, some people I've charged an arm and a leg simply because I know they need it, I know I'm in a unique position to help them, and I have no vested interest in whether or not they take my offer - my personal time is valuable to me. If I had enough offers for work at high enough pay to make me really think about eating it all up, I'd quit my day job and just do that.
Re: The Money/Time fallacy
#5I refuse to peg every remaining second of my existence to the highest hourly rate someone else will pay me for it. I won't say "My time is valued at $XX per hour, so it makes sense to pay $XX for someone else to do this." Valuing all time at an hourly rate is logical if a human is trying to maximize the amount of money made across their life - since you could theoretically pay for this task to be done while working,…
You can get exciting things for money (travelling for example is not always trivial financially).
More to the point, both point of views have utility. I criticize "my time has a numerical value" in the post, but it is useful to have some metric in order to get your fair market value (i.e. in negotiations) or when you are in a period where all you want is to gain monetary freedom.
In my original draft I had the mentioned reasons titled "the factual" and I started another section titled "the existential" [reasons I find the principle problematic], where I started to delve more into why perhaps you don't want to put a price tag at all. But as the post deals more with concrete criticism and possible improvements of the application of such a price tag and assuming its existence, it felt out of place and I decided to explore it more in another post.
EDIT: also, as another wrote here you do have situations/periods in life where you may need to apply such a metric and then proper application and self-reflection is important.
Re: The Money/Time fallacy
#6I refuse to peg every remaining second of my existence to the highest hourly rate someone else will pay me for it. I won't say "My time is valued at $XX per hour, so it makes sense to pay $XX for someone else to do this." Valuing all time at an hourly rate is logical if a human is trying to maximize the amount of money made across their life - since you could theoretically pay for this task to be done while working,…
Eventually, you will come across a situation where you need to decide if you will "work" in your free time (painting your house, mowing your lawn, etc), or if you will pay someone to do this so that you can free up your own time to "maximize life enjoyment". The time = money equation isn't just about always earning money, it's about cost savings & cost avoidance as well. You have to decide, what makes you happiest? I…
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Re: The Money/Time fallacy
#7I refuse to peg every remaining second of my existence to the highest hourly rate someone else will pay me for it. I won't say "My time is valued at $XX per hour, so it makes sense to pay $XX for someone else to do this." Valuing all time at an hourly rate is logical if a human is trying to maximize the amount of money made across their life - since you could theoretically pay for this task to be done while working,…
You can get exciting things for money (travelling for example is not always trivial financially). More to the point, both point of views have utility. I criticize "my time has a numerical value" in the post, but it is useful to have some metric in order to get your fair market value (i.e. in negotiations) or when you are in a period where all you want is to gain monetary freedom. In my original draft I had the mentio…
It is useful to have a metric of how other humans value your time and ability, true. And storing enough resources so you don't have to go without essentials is just good planning. But it seems nonsensical to base your entire self-valuation as a human on that arbitrary number.
"Monetary freedom" makes limited sense to me - free from what? Free from having to be productive (to other humans in society) in order to get food and keep your shelter?
Re: The Money/Time fallacy
#8I refuse to peg every remaining second of my existence to the highest hourly rate someone else will pay me for it. I won't say "My time is valued at $XX per hour, so it makes sense to pay $XX for someone else to do this." Valuing all time at an hourly rate is logical if a human is trying to maximize the amount of money made across their life - since you could theoretically pay for this task to be done while working,…
Eventually, you will come across a situation where you need to decide if you will "work" in your free time (painting your house, mowing your lawn, etc), or if you will pay someone to do this so that you can free up your own time to "maximize life enjoyment". The time = money equation isn't just about always earning money, it's about cost savings & cost avoidance as well. You have to decide, what makes you happiest? I…
You have to decide, what makes you happiest? If it is freeing up your time to do something else, then you might even pay a premium to have someone paint your house for you.
Exactly, ultimately these are all pathways to the same question/answer.
Re: The Money/Time fallacy
#9I partially agree, but would take it a step further -- your time actually has zero value in and of itself. Because we have companies (or clients) paying us a salary that takes up a portion of our time, we tend to think in those terms, but it's not the correct way to think about it. The end goal of that work we do is not to make money. Money is not a goal in and of itself (or if it is, priorities need to be shifted). The end goal is hopefully a happier, more productive life, which money (sometimes) helps us to obtain.
I work 40 hour weeks so that when I'm not working, I am able to focus 100% on my family and self. By working a job, I can (nearly) guarantee that money will solve those other problems. Leaky roof? No worries, hire a contractor. Car broken down? Call a mechanic and get on with the more important stuff. Need to paint? Pay someone.
If you take money out of the equation, it's just bartering: I do something I'm good at so that I can trade that effort for someone else doing something they're good at, and so on. The end goal is that instead of spending our entire lives worrying about Maslow-ian needs, I can spend a portion of that time doing specialized work that allows me to not worry about those things. It's a trade of quality vs. quantity.
Re: The Money/Time fallacy
#10There's a nice Quora thread that's related to this post: http://www.quora.com/Personal-Finance/If-I-make-30-per-hour-...