“Time is money.” We’ve all heard this phrase, and as a cliché it’s all but lost its meaning. But it’s true!
Just think, how did most of the money that you have ever had in your life get to you? Yes, you probably received some gifts, maybe a scholarship, or an inheritance even. But the vast majority of the money that comes to you is probably coming from your job. No matter who you are or what kind of job you have, a job is simply a tool that converts your time into a good or service, that you are then given money for. Therefore, money is just a measure of the amount of time you have put in.
Say I make $10 per hour, and I want to buy a new bike that costs $300. That bike costs 30 hours of my time. Easy enough right?
I was thinking about this concept while standing on a sidewalk in downtown Dallas yesterday at 5 pm, waiting for the bus to take me home. I watched an unusual amount of new fancy cars thunder past me. Mercedes, Range Rovers, Jaguars, and a Maserati. Each contained exactly one person, a business man or woman speeding home.
Let’s say for easy math, a new Range Rover costs $100,000 (actual price is pretty close, not bad!) and our luxurious businessperson makes $150,000 per year, or $75 per hour (which would almost put them in the top 5% of earners in the US).
This means that their Range Rover costs 1,333 hours of their time just to purchase, not counting gas, maintenance, or insurance.
1,333 hours.
I wonder if the people who buy these cars would make the same decision if the purchase was presented to them in hours instead of dollars and cents. “Ma’am, this vehicle is the top of the line in luxury products, and you only have to spend 1,333 hours away from your friends, family, and hobbies” No thanks!
What’s more concerning is people who don’t make that much per hour, and then buy a fancy car with a loan. If you’re making $15 an hour and take on debt to buy a $30,000 car, then you’re signing away a future 2,000 hours of your time (most likely more due to interest). You are now chained to that car payment, it owns you.
The next time you make a major purchase, think about the time that it costs, not the amount of money. Is the time that you could spend doing *insert thing you love doing* worth giving up for *insert purchase*?
And if you decide to save the money, be sure to invest it and make that retirement account grow! #MoneyGoals