Do you know what your time is worth? This is important, because you should use this information to guide your life. Let me tell you how.
First, you need to estimate what you make per hour.
- If you are an employee, divide your yearly salary by the number of hours you work per week x the number of weeks. If you are haunted by the specter of unpaid overtime, remember to use actual worked hours, not what your contract says.
- If you are a freelance consultant billing by the hour, your time is worth whatever your average billing rate is.
- If you are a freelance consultant working on fixed price projects, you need to register your time to calculate in order to calculate what you make per hour.
This number is what an hour is worth to you right now – it is the exchange rate between minutes and dollars. You can use this to guide decisions about how to spend your time and money.
Some decisions are simple math: If it takes you half an hour extra to drive to a cheaper shop, are you saving more than the cost of the 30 minutes? If you save $200 by taking a flight with a connection instead of direct, is it worth the extra travel time?
Other decisions cannot be calculated as easily, but the value of your time can still guide you. Do you think knowing another programming language or technology would get you a better job? How much more would you make, and how many hours would it take to acquire the necessary skill?
Figure out what your time is worth – and act accordingly.
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