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Monday, February 23, 2009

Downtime

in: Balmain East NSW, Australia

Normally I spend 3 hours a day traveling to and from work. This is essentially dead time in which I do nothing; I listen to podcasts, I read books. I recognise that these are possibly luxuries that other people would struggle to make time for but the point is I can’t do anything else. Also I exhausted my fairly small library quite quickly, I don’t spend much money on music and whilst the internet has made it easier to find things *cough* quite cheaply *cough* I still haven’t really bothered.

The solution seems pretty obvious i.e. buy a car. However [insert environmental whinging here] and [insert ongoing cost whinging here] so I wasn’t that keen. Until I did the following bit of thinking.

Everyone values their free time but they never put a metric on it. Everyone says they wish they had more time to spend [insert activity or in the company of family here]. So I thought about the spend part of that sentence and actually put a cash value on it. For the sake of argument I valued my time at a reasonably modest $35 an hour. This means I spend $105 of my time each day traveling. Owning a car would give me back 2 of those hours on average saving me $70 of personal time per day. That’s $350 of personal time a week, or extrapolated to 48 working weeks a year, nearly $17,000 of personal time. Getting a car now seems like quite a good idea, an investment even.

Caveat and note to self: This is a gross over-simplification and does not mean that getting a car will make you richer in cash terms unless you can convert those hours into money, which you won’t. Rates are subject to change without notice.

Residual thoughts: What other effects might giving your time a cash value have? How else might I value my time? Given this value what would I do with the extra 2 hours a day?