What’s the Value of Your Time?

7 May

A little headstand action at the top of Gomez Peak in NM. Photo by awesome-sauce SIL Ida Holguin-Perez.

A little headstand action at the top of Gomez Peak in NM.

I’ve recently decided to make a switch in my yoga routine by attending a new studio. It’s much closer to my home and workplace and offers a fresh approach to my practice, which has honestly become a bit stale as of late. While it may seem like a no-brainer decision, the monthly cost difference for unlimited classes is significant: the new studio, we’ll call it Studio B, is $47 more per month than my old studio, Studio A. I can attend unlimited classes at Studio A for $60 per month, or pay $107 per month for unlimited classes at Studio B.

To help justify the switch, I calculated the cost of fuel to get to/from Studio A vs. Studio B. The average cost of fuel in my area is $3.79 per gallon, and my car gets around 25 miles per gallon. I attend class twice per week, or eight times per month. Given all that, it costs me about $39 to get to/from Studio A (33 miles RT) vs. $18.19 per month to get to/from Studio B (15 miles RT). While it costs twice as much in gas to get to Studio A, I’m still paying $25 per month to attend Studio B when you add membership costs.

Another factor in all this is the cost of my time. I’m on the road 25 minutes longer per class with Studio A, or two hours and 40 minutes longer per month. Putting a dollar amount to each hour of your free time is not an easy task, which is why I turned to a survey at ClearThinking.org to help me. It asks a series of questions to help you determine the unique value associated with an hour of your time. If you’ve ever wondered about the monetary value of your time, I highly recommend the survey (it’s free, but it will take you about 15 minutes).

After taking the survey, my results concluded that I value my time at $45 per hour. Since it takes about 50 minutes round trip to get from work to Studio A and back home again, it costs me an equivalent of $37.50 each class. Multiply that by twice a week for a whole month, and the added cost to Studio A’s monthly membership is $270. It takes me about 25 minutes round trip to get to Studio B from work and home again, amounting to $18.75 each time. My time adds $150 to Studio B’s monthly cost.

Adding the value of my time to the total monthly cost to attend each studio, including membership fees and gas charges, gave me a more accurate picture of just how much I’m spending on yoga between the two studios. It will cost $369.04 per month to continue classes at Studio A, while Studio B will cost me $275.19. That’s a savings of $93.85 per month.

While the monetary value of my time is subjective at best, this exercise does a good job illustrating the necessity of factoring in your time when making a decision. Even when I calculated all this using my hourly rate at work, I still come out on top by joining Studio B.

Do you consider the monetary value of your time when making a decision?  

Disclaimer: I suck at math, so if you notice any flaws in my calculations, please break it to me gently.

14 Responses to “What’s the Value of Your Time?”

  1. Kali @ Common Sense Millennial May 8, 2014 at 1:35 am #

    This is a really interesting way to look at things, Kendal! Your time IS important, so it’s worth factoring in to decisions like that. I hope you enjoy going to the new studio – it certainly seems worth the change in membership fees :) Sweet headstand as well! I’m jealous – I totally want to learn how to do that!

    • Kendal May 8, 2014 at 2:16 pm #

      This exercise did help me feel better about spending more per month at the new studio. I have a tendency to opt for the best deal even if it sacrifices what I really want, which isn’t a good use of money! And the headstand is harder than it looks — it’s all about putting the weight into your shoulders and forearms and NOT your head. I bet your fit self could do it!

  2. Brock @CleverDude May 9, 2014 at 12:00 am #

    I would certainly count the price of fuel when comparing the savings, but would lump the time factor, as well as the positives from a fresh routine as “intangible benefits” for switching. They would certainly help me make my decision, but unless it actually puts money in my pocket I wouldn’t put a monetary value on it.

    • Kendal May 9, 2014 at 7:55 pm #

      “Intangible benefits”…I like it. I concede that I’m spending way too much time analyzing this decision (it cost me about $45, ha!), but I think it helps those of us who focus too much on the sticker price to put the value of purchases in perspective.

  3. Love the idea of that survey, going to take it now!

    • Kendal May 9, 2014 at 7:51 pm #

      Yay! I hope you find it useful.

  4. Mel @ brokeGIRLrich May 11, 2014 at 1:07 am #

    I love the idea of the survey! I’m going to check that right out.

    It’s interesting to think about how you “value” your time. It would be awesome if we could automatically be earning that amount somehow when we wanted to apply ourselves.

    I struggle with this with side hustles, because when I first started out with both freelance writing and building props I would take pretty much anything, because I figured the current value of my unoccupied time was $0. Since then, I’ve come to think differently about that, but I’m not 100% sure how to really put a number on what time is worth. It’s easier when asked in the context of taking on a project rather than just pondering it philosophically (although that’s kind of fun too).

    • Kendal May 13, 2014 at 3:21 pm #

      I’m with you on the freelance thing. My first instinct is to do something for free or super cheap, and because of that I actually set my freelance rate pretty high. At one point, one of my clients wanted me to reduce that rate for a specific project. She argued the work wasn’t complicated enough to justify my rate, but I told her my rate isn’t based on the work, but rather my time. I also reminded her she works with me because I get things done exactly as she likes and in the time she requires, which is typically fast! You have to build those qualities into your rate too, and fight for them when they’re questioned. Thanks so much for commenting!

  5. Jessica Moorhouse May 13, 2014 at 3:13 pm #

    I’ve never really put a dollar amount value on my time, but that’s a great idea!

    • Kendal May 13, 2014 at 3:16 pm #

      That’s likely because you don’t over-think decisions like me! It is an interesting exercise nonetheless. Thanks for commenting!

  6. Josh Rodriguez May 19, 2014 at 5:59 pm #

    I absolutely value my time. I’m actually working on a tracker now to track every minute of my working day. A process I call time budgeting! Thanks for the great read, looks like you’ve definitely justified moving to studio B!

    • Kendal May 19, 2014 at 6:04 pm #

      Thanks so much for reading, Josh! Time budgeting — love it! I’m trying to be more thoughtful about how I spend my time and this exercise gave me some good perspective.

  7. KK @ Student Debt Survivor May 20, 2014 at 8:18 pm #

    I definitely don’t account for the cost of my time as much as I should. Since time is money I probably waste a ridiculous amount of money. In the past I’ve spent a ton of time figuring out DIY projects, when I could have just paid someone to do the work for more and probably paid less. But there’s also some satisfaction in doing the work yourself (I’m thinking of a painting project).

    • Kendal May 20, 2014 at 8:22 pm #

      I think there’s definitely a line to be crossed when it comes to considering the value of your time. If you really thought your time was worth $50 an hour, you would be hard-pressed to do anything yourself if someone else is willing to do it for less. However, it’s not that straightforward and the intangible benefits of DIY should also be factored into the cost. My husband joked that we could save money by driving to Tucson instead of flying, but at his hourly rate it would be MUCH cheaper for us to fly. Ha!