time Management For Dummies - How Do You Value Your Time?
Time is money. But how much money is your time worth? If you are self-employed or work in a business where you bill for your time, working out the value of your time is an imperative exercise to ensure you bring in enough money to cover your costs, and then some.
Once you know the value of your time, you can place more time on tasks that provide a high return, therefore being worthwhile to perform. Tasks that are low in value might not be worth doing, delegated or certainly be lower on your priority list.
So how do you work out the dollar value for each hour you work? Follow this procedure to give you a basic idea of the value of your time.
1. Your yearly salary; plus
2. Your benefits (car allowance, etc); plus
3. Payroll taxes; plus
4. Contribution for rent, equipment, electricity etc.; plus
5. Contribution for overhead (eg phones, mail, receptionists etc.; plus
6. Profit expected. This will depend on the area you work in. A guideline would be 50% of all the other costs should be your profit margin;
7. Add all these figures up; then
8. Calculate the number of working days in a year, taking into account vacations, public holidays, sick days and training days; now
9. Divide the dollar figure by the number of working days
10. Finally divide this figure by the number of hours you work a day. And that figure is how much you are worth per hour. That is the value of your time.
You may use this figure as a billing estimate if your company bills time out (eg lawyers, health professionals). If you want larger profits or aim to be a high achiever, you may want to increase this value for billing purposes.
But how does this work if you’re not bringing in money, such as a student or homemaker? Your time is valuable too, but putting a monetary figure on your hours might not be how you would value your time. Do you value your time sufficiently to think about making changes in regards to low value tasks? Working out how much it would cost in dollars and time saved if someone else were to do some of your tasks (such as the ironing) might be a worthwhile exercise. This way you can spend more of your valuable time on worthwhile tasks (such as studying or attending personal pursuits).
Valuing you time is a monetary and expressive experience. You are saying "I am worth X amount" and "My time is too valuable to waste on doing X". Value your time according to contributions. Value yourself and all that you accomplish.
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