Read about my successes and failures. Learn from my experiences and gain insight without losing any cash!!!
Lesson: Catching a Falling Knife
Lesson: Currency Exchange
Lesson: Mutual Fund
Lesson: Paid to Wait
Lesson: Pricing in a Downturn
This is where you’ll find find my Blog. I will comment on the latest news relating to investing, real estate, and the financial markets.
If, like me, you have wondered about being able to value your time properly, perhaps going through this example might help you. My first suggestion, is to try different activities, (especially if you don’t have any idea of what they cost or how long they take to do) this way you will not be taken advantage of by the professionals. Obviously, make sure that you are capable of doing the tasks, and that it wont cause any long-term damage. This is especially critical for busy mid-level employees, as you are no longer working hourly, and have gotten raises, but now face the problem of not being able to leave work on time, or needing to work from home, and feel that you should just pay for someone else to do tasks.
Let’s take the example of demolishing a large shed in your yard, as it is rotted, infested and needs replacement. This will generate a huge amount of building waste that cannot be disposed of through the regular garbage pick up.
Get a few quotes on the job, and now start to analyze what it would take for you to do this. For this example the lowest proposal came in at $500. Sometimes the value of your time is quickly apparent: maybe you are unable to adequately perform this task, or the quote is so affordable that you just want to pay for it. But here’s how you can figure it out. Try some quick math: Take the cost of a truck rental and the gas you would spend going to the dump, say $120. Now estimate the dump fees, which usually relate to the weight. If you haven’t really got a clue, just ballpark the weight and look up dump fees online, in a few minutes you should have a pretty good cost estimate considering you’re a rookie. Let’s say this comes to about $180. Now, with the cost of the truck, fuel, and the dump fees, your at $300 compared to $500 for someone else to do it, and some people would stop there, but let’s keep going. Now try and estimate the time you would spend doing the work, since this is a pretty big job, in all likelihood it will take you about 8 hours to do the work and another hour of traveling time to the dump and back, for nine hours total, at $30 an hour, that’s another $270!
Not to mention that it is very heavy waste and therefore an exhausting task! When you accurately put a value on your time, you are looking at the equivalent of $570 for you to do it yourself or $500 for someone else to do it. In this case, you would want to pay someone to do the haulage for you, and work those nine hours on something that would make you more money, or spend time with your family. But remember, you might make a different choice if you earned $10 per hour.