As entrepreneurs and business owners, we often despair that there are only 24 hours in our day or “x” amount of dollars in our business accounts or we are stressed to the max because we have “a million” tasks on our plates. We feel like our time, our money and our stamina are stretched beyond what we can manage. It’s from this place that we often toss around sayings regarding the value of our time such as, “It isn’t worth my time,” or “I’ve got more time than money.” When it comes down to it, though, do you truly know what your time is worth? Calculating how valuable your time is provides you with a benchmark. This benchmark helps you increase your bottom line by decreasing the time you spend on tasks that would be more cost-effective to delegate.
SO HOW MUCH IS MY TIME REALLY WORTH?
The value of your time is not arbitrary. Rather, there is an easy formula for computing its value. Take the amount of money you make each year and divide it by the number of hours you work each year. A 40-hour workweek equals approximately 2000 hours per year. This will determine how much per hour your time is actually worth.
Delegate, delegate, delegate.
Let’s say you determine your time to be worth $40 per hour. Is it a good use of your time to do an office supply run or could you ask your $15/hr. employee to do that for you? Or how about when it comes to entering receipts in QuickBooks? Is it worth $40/hr. for you to be the one to enter those or do you have a trustworthy $20/hr. employee who could do the job just as easily? Delegating can be difficult but once you assign a dollar value to your time, you will probably realize there are at least a few areas where delegating translates into a cost-savings for your company.
Consider ways you can manage your time more effectively.
Now that you know how valuable your time really is, let that be the lens through which you view your workday decisions. Would an email be a more succinct way to communicate with your client or would a phone call or in-person lunch meeting help you hash out details that an email correspondence could take days to flush out? Or maybe there are programs or applications that could take over some of your time-consuming, day-to-day, manual operations.
We all want to maximize our efficiency and our bottom lines and calculating the value of our time is one fundamental component to achieving those goals. It can be the catalyst to confidently delegating certain tasks and looking for more efficient ways to run workday operations.