The Value of Time

On my way home from work today, I noticed the corner gas station seemed awfully busy. Busy enough that cars were lined out into the street, which is pretty unusual in a small town with 8 gas stations. Why so busy? I’m going to guess that the $1.08/litre price might have had something to do with it. One more gas station was priced similarly, while the other 6 gas stations were priced around $1.18/litre.  I glanced at my fuel gauge (half-full) and then looked over at the unmoving line, backing further up into the street. By the time the stoplight changed, I decided it wasn’t worth my time to get in line and wait for the cheaper gas.

What is my time worth? How do I judge when something is worth it and when something isn’t? With the cheap gas, I figured I would be waiting at least half an hour to get to a pump, I’d be idling my car, I still had half a tank of fuel, and I would be late for a steak supper at my parents. Those costs, at least in my mind, were greater than the prospective savings on cheap gas, so I decided not to wait in line.

I could simply quantify the value of my time using my salary rate or charge rate. It’s easy and it’s based on an hourly time frame. My boss has often remarked to me that this is how he determines what is worth his time and what isn’t. For example, he lives close to the border with the States, and for him, it isn’t worth his time to go over the border for cheaper groceries and gas. He would rather save time but spend a little more to buy gas and groceries in Ontario. His decision though (according to him) is based solely on his charge time.

For me though, the value of time can’t simply be quantified. There’s a strong qualitative component to the value of my time – my desire to get to my parents and have a steak dinner influenced my decision not to wait for cheap gas, just as an example. I would say that the situation influences the value of time: am I already waiting, do I have to go somewhere, am I going out of my way, how badly do I need or want something, even what’s the weather doing can influence how much value I put on my time.

The value of my time is a moving target, highly variable, but something I can calculate almost instantaneously (without even a calculator!) in most situations. What influences the value you put on time?  

Have a good ‘un

Country Girl

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Categories: Unavoidable Costs | Tags: , , , | 13 Comments

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13 thoughts on “The Value of Time

  1. I always think about how much time it would take me to work and pay off something, so my wage is entwined with my time value.

  2. I usually don’t put a value on time. If I were that situation, it would depend on how lazy I feel or if I have a certain amount of things to do by a certain time.

  3. I wonder how many of those people waiting in line were idling their cars and wasting that $0.10/L doing so?

  4. Pingback: Zones | Digging Out and Up

  5. The way I see it is this: The only way valuing my time based on an hourly wage works is if I actually have the ability to work extra hours. For example, I need to mow my lawn. It takes a hour. I take that time and work the extra hour at work, and get paid for it. I could then take a portion of that extra cash to pay a kid next door to mow my lawn. I’d come out ahead on that one.

    Unfortunately I’m not allowed to work overtime, so my hourly rate is not a good way to value my time outside of work, because that wage isn’t changing.

    As such I value my time based on the level of savings associated with the extra time committed. Usually it works out to around a dollar a minute. If I can save $5 for 5 minutes of work, it’s worth it. 10 minutes for $10, an hour for $60…that’s my general rule of thumb.

  6. I think about this kind of thing all the time. As someone who works from home and runs various online projects, time is extremely valuable. If it is going to take me too long to save some money, it usually isn’t worth it. I guess in your gas station example, that’s where it would be awesome to have a tablet computer that you could whip out to write a blogpost or do something else productive. Perhaps I’ll cave and buy myself one soon for that very reason.

    • I actually had my iPad with me, but with my luck I’d end up with a distracted driving charge since the line up for gas was out onto the road. 😉

  7. Cait

    I’ve never put much value on time… not because I don’t think it’s worth thinking about, but because I think you can lose out on certain opportunities by worrying about it too much. I *do* think about how long it will take to pay things off though. So I’d never take on, say, $3,000 of useless debt again, because I know it would likely take a year to pay off. Not worth my time!

    • I like your attitude. I can’t help but wonder if I put a bit more value on time because time is used to measure distance around here. For example, the nearest city is 2 hours away (but I have no idea how many kms it would be). I’m usually thinking in time, which is probably why I put a value on it, but you’re right – you don’t want to worry about it too much!

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