When you have a more traditional job working at a more conventional company, you can expect to trade your hours for dollars. You are literally trading away your time to work for this company and, in exchange, they will provide you with dollars. That’s how an hourly wage works and fundamentally how your typical salary works too when you break it down on a per-hour basis. And, for the most part, this is how the majority of the business world works.
But if you’re of the mindset that you want to run your own business and you want to make money online, then you’re clearly motivated in getting out of the rat race altogether. After all, the winner of the rat race at the end of the day is still a rat. To this end, you’re not interested in trading your hours for dollars. You’re interested in building a system that can earn money for you, with or without any further input on your part. That’s the beauty of passive income, but of course it takes an investment of your time to build such a system.
It’s not a 1-to-1 trade. Even so, it’s still abundantly clear that over the long run, time is money. The difference is that while you will always have more opportunities to make more money, you really have zero opportunities to make more time. Once that time is spent, however you choose to spend it, you will never get it back again. That minute or two that you just spent reading the words in this post thus far? You’ll never get those back. (But they were a good investment in your future.)
Allow me to illustrate how time is money with one very specific example.
Some time back, a friend of mine posted a picture on Facebook of a lineup outside the Starbucks near his office. On this day, starting at 1pm and running for about an hour or two, Starbucks was going to give away one of its new iced teas to anyone who wanted it. Everyone is drawn to this idea of “free,” so fans stormed their local shops on this day.
The thing is that my friend took the picture shortly before noon and the lineup was already at least 20 or 30 people deep. The free drinks were not going to be handed out until 1pm. What this meant was that the first person in this line would not be receiving the iced tea for an hour. And even if we are overly optimistic and say that Starbucks will be able to serve one customer a minute, that means the last person in line won’t get his or her drink for 90 minutes.
Now, let’s put all of that into perspective. Let’s value the iced tea at approximately $3.50 including tax (if you were to purchase it on any other day). In effect, the person at the end of the lineup at noon is valuing 90 minutes of his or her time at $3.50, because that’s how long it would take to get that much value out of standing in line. This works out to about $2.33 an hour, roughly one-quarter of minimum wage here in British Columbia.
It’s only free if your time is worthless.
Even if you took that time to spend on some of those online surveys that only pay a few dollars, I’m fairly certain you could earn more than $3.50 in an hour and a half. Better still, you could spend that hour and a half investing in yourself or investing in your business. Learn something about blogging or Internet marketing that can grow your income potential long-term. Spend some quality time with the people you care about (priceless). Take the time to work on that e-book you’ve been writing.
The Starbucks example might sound a little superfluous or ridiculous, but it illustrates the very important point that time is money. When I wrote my book, I paid someone else to handle the formatting, because I didn’t want to spend the time to learn how to do it properly. That was money well spent. The same was true for paying someone to design the book cover, just as I paid someone to design my business cards and to help rework the design on my blog.
I could have spent the time myself to learn how to do these things, but it would have taken me a lot of time and the end results wouldn’t have been as good either. I considered those investments, not expenses, and they also freed up my time to focus on what I could do better and what I actually wanted to do.
Time is money. You decide which one is more important to you.