I suppose the route of this question is to figure out how you could be spending your time, and looking at how other people value your time… When you have a quantitative value of your time – hour by hour, it can drive some very important decisions in your business, and in your personal life, but it’s not always that easy to calculate.
It’s true that all time is not created equal and how you value it differs. Time spent with family and loved ones is completely different to the time you spend creating compelling presentations to convert leads into sales. But you can’t do everything at all at once!
Time vs cash
We all have an instinctive awareness of the value of our time – how many times have you said, it’s not worth going all that way, or weighed up whether to pay for shipping or your own time for collection? Or maybe you’ve recently bought extortionate concert tickets and justified it as an experience of a lifetime…
You make decisions like these all the time without really knowing how your time compares to the cash value of it. And that’s why I’d like to help you figure out what your time is really worth, to better inform your decisions.
The Time/Worth calculation
This calculation might be easier than you first thought, so give it a go and find out if:
- You’re spending your time effectively
- You’re charging your true worth
- Your clients or customers respect your true worth.
- Write down the amount of time you spend actually working (x) and
- The amount of money you earn during that time (y).
(At this point, I’d like to remind you about effective time management, so it makes these calculations much easier).
3. Divide y by x and you get your hourly value.
Is value the same as worth?
It seems obvious really, but let’s say you’re a freelancer charging £50/hour, over a working year of 50 hours/week, and say 44 weeks a year. Are you actually earning £110,000 a year? That’s the value – the price, but what is your worth?
Perhaps a more accurate way of calculating your time’s worth would be to compare what the market will pay. How much are other companies like you charging? What could you expect to be paid if you were employed, rather than self-employed? Do you have overheads to cover, training and specialist skills? Are you positioning yourself as a ‘budget friendly’ or ‘high end’ provider?
And that’s where it gets a lot more complicated.
If you’d like some help to ensure you’re spending your time on high pay off activities, and that your customers pay you what you’re truly worth, then let’s have a chat. In the meantime, feel free to grab my free time/worth download to help you work out that more complicated calculation.