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8/10/07

How Much is Your Time Worth?

What one is paid versus what one thinks he/she should be paid is the ever existing conflict between employees and employers. “You can never become wealthy by working for somebody else.” You may have heard this in the past because I am definitely not the first to state it, but the quote is true. Let me make a distinction so that I am not misunderstood. I know many of you are thinking, “what about business executives and the such that make a couple hundred thousand dollars a year? These guys and gals are wealthy and they work for somebody!” The problem is, these people are not wealthy; these people are rich. What is the difference? People that are rich presently have a lot of money, but their money depends on their continued employment. If you take away the successful job of a rich person, he/she will not be rich for long. On the other hand, a wealthy person’s money does not depend on employment. A wealthy person has residual and passive income flowing monthly. If a wealthy person is employed, it is because he/she wants to be, not because he/she needs to be.

What does this have to do with determining how much your time is worth? Put simply, determining the value of your time determines whether you are going to be wealthy. Do not think of this problem in a purely literal sense. Do not think, “if I make $150 per hour and work full time for X amount of weeks per year, I could have X amount of dollars.” This way of thinking is short sided. Instead, you must consider what you do with your time.

I was reading an article that theoretically calculated the amount of money it costs to watch television. Do not get me wrong, I enjoy television as much as the next person and am not willing to give it up, however, this article really makes one think about the value of time. The article considered the electricity used, the extra dollars spent from watching commercials, the cost of a television, the opportunity cost, and many other variables. The author added up these costs, and compounded something like eight percent (8%) interest on the sum. The cost of watching television over the course of a number of years turned out to be monumental! The point of this story is not to convince you to give up television, it is to motivate you to use your time effectively and take advantage of the time you have.

If you want to make money, use some free time to plan for a way to do such. Do not give up because things are not happening immediately, just remember, it is only a matter of time!


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