The Value of Time – or why your macro time management probably needs an essential update

Good morning everybody!

Have you ever taken a course or read a blog post on time management? I bet you have. Maybe you had a presentation or seminar on time management at work or at uni. That is excellent to start with! Now let's go one step further.

What you did in terms of time management is what I would call micro time management. This discipline is well-covered with many fine professionals out there helping you get things done, like the Getting Things Done method, which I highly recommend you check out. People like Stephen Covey take a more strategic approach and try to bring micro time management and personal values together. Maybe you heard of his book “The 7 Habits of Highly Effective People”. In essence, they treat your overarching life priorities like points to be inserted into your to-do list to make sure you do not miss out on everything else besides work. Sounds complicated? Yes it is, but it pays off.

What I want to do, is go straight to the macro level and get this sorted out. After all, if we can eliminate something or course-correct on the macro level, a lot of the micro work will become unnecessary.

In order to do so, we have to understand the nature of time.

• Time is irreplaceable. Time spent today is spent and can not be recovered.
• Time is limited. You have only a certain amount of days and weekends.
• Time today is more worth than time later in life due to old age, wear and tear, less energy available, illness, etc,

Taking the depreciative nature of time into account, is it really smart to work yourself to the bone when you are young to have free time when you are old and suffering from the very conditions the self-destructive behavior of the young self brought upon you?

Probably not. The problem here is that people do not have a mental model to understand time in this way. Everybody has a mental model about money, which bears a striking parallel and inverse relationship with money.

• Money is replaceable. It can be recovered. But doing so make us lose time, which is far more precious.
• Money is almost unlimited. You can always make more, your money can make more money through compounding.
• Money today is more worth than later in life due to inflation.

We have the term “purchasing power” in terms of money. But we do not have this term for time. We can use the next best thing and use “youth” without the age connotation and “experience” without the age connotation.

The highest “purchasing power” for your time would be the sweet spot between having the energy, strength, performance, flexibility and physicality of a young athlete plus the experience, knowledge, mental resolve and iron mind of somebody way older and wiser.

It is obvious that we have a few things figured out the wrong way, so how can we get more life? More done, less mistakes, less time wasted, more wonderful experiences and self-expression?

My question to all of you is: How would you manage your life if you wanted to maximize your “time purchasing power” with maximium performance, exploration, awe and wonder, joy and knowledge?

After all, you are constantly evaluating whether you get value for money. Smart people also ask themselves whether they get more enjoyment from the money spent now than from the purchase power after your money grew in the stock market. Now we can ask ourselves the same questions about our time. Is it really worth investing so much time in this project? Will it be more advantageous to do it now or later? If later, when?

A few examples and guiding questions: - Working yourself to the bone and ruining your health is depreciating your time rapidly and thus has to be avoided for most people. Risking your health as a super-rich athlete and retiring from competition at 30 years old might be worthwhile risk to take. Ruining yourself and wasting your youth and potential for a meager salary of $40.000 without further upside might not be. What does a job need to offer in terms of pay, network, skills and experience to make it worthwhile to work there?

- What importance does financial planning get under these circumstances? What about planning financially for consumption, experiences, obtaining knowledge, middle age and old age?

- What importance does learning at a young age have? If you could do it all over again, would you go to the same schools and learn the same things or would you prefer a different more practical and mentor-like apprenticeship to reach excellence?

- Would you still invest more time into your career than into your skills or your partner? - Would you still live in a cold and dark place just to waste time, youth, options and health on a job without the possibility to advance in all other areas of life?

- What about writing down everything you do in a day, or even better a week, and checking what return of time and money you get from that? - Would you still evaluate pay in terms of an hourly wage?

What about keeping the time you work fixed and increasing the value by shifting to progressively more demanding and more value-generating tasks? Would that give you a better return in terms of money to your fixed investment of time? How much time later can you buy with what amount of money now?

Feel free to ponder this for a while. I will not feel offended if you stop reading here... I promise. Let's talk about a few examples to avoid confusion. Let's say you have a diner. You could increase value by turning it into a Starbucks style high-priced caffeteria. You could make it an organic juice bar. These freshly squeezed juices from fresh organic fruit are really expensive. We are talking about 5 to 6 € per glass in a normal place. In an expensive city the price might be higher. The diner would have the same rent and location, higher costs for the ingredients of different dishes, cooks and waiter on the payroll, more preparation time etc. The caffeteria has higher prices, less food, and inexpensive ingredients. At the same time you need less people to operate it. I know a Japanese coffee shop in Italy that is making a killing. The iced coconut coffee is 7 € for 400 ml and it is prepared even faster than your ordinary caramel macchiato or pineapple-ginger-strawberry-celery juice. At the same time, the place is tiny and everybody only comes for the take-away drinks.

Let's say you are in the business of processing documents. If you lower prices and write a software saving 80% of the work, you can work less, get more done and ultimately make a lot more. As soon as you can hire somebody to do your job, you can multiply that and focus on even more valuable work.

Of course, this is not the only way of thinking about that. If you happen to have no inclination of taking on ever more responsibility, this might not work for you. The variation with the juice bar or the Japanese coffee parlor might be just up your alley. Same work, less expenses, higher prices, more bottom line.

In every line of work there are companies that pay more than others, there are niches where clients pay more, there are countries where salaries are a lot higher for the same qualification and less work. It is your responsibility to choose well and make the best in your individual situation.

It is your life. So what are you getting for your time? What are you giving up because you are spending your time on things you do not want to do? So many questions... I know, thinking is hard work sometimes, but this way we determine whether we are walking in the right direction before optimizing anything.

All roads lead to Rome, but you still have to choose the right one for you.

All the best,

Wolf

Wolf