True wealth is owning your time.
Outlaying money to save time is the integral ingredient for life satisfaction. Funds spent to avoid unpleasant chores and the like provides a tremendous ROI.
Research across four countries confirms the vital role of trading money for time for quality of life enhancement.
Arnold’s Pump Club reported the following:
People who regularly paid to save time were more satisfied with their lives, and it held across the income range, not just among the well-off. So it wasn’t about how much money was spent but about getting time back.
The scientists noted that the magic was in the buffering. Time stress usually lowers how good you feel about your life. For people who bought back time, that drag mostly vanished.
I couldn’t concur more with the findings. One of the banes of my existence is attending weddings. 8-10 hours of time, dinner at 10 PM, Inane small talk, Obnoxious DJ’s, Pictures, Drunks, etc. there is literally no amount of money I would fork over to avoid the majority of these affairs.
In fact if given a choice of not attending but doubling my gift, I would gladly open the floodgates and buy back tranquility but I digress.
Here is where things get interesting regarding this study. It turns out few people will make these transactions on their own. Only 2% of one group would spend a windfall to save time and about half of 818 millionaires outsourced nothing.
How does this information impact your own personal finances?
Beginning with the often toxic and misguided debates of the value of a competent financial advisor. There are those who believe paying someone 1% or so annually to manage their assets is grand larceny.
Critics have a point if that person happens to be your typical commissioned salesperson hocking expensive and inappropriate products with the sole goal of generating income for their retirement, not yours. Unfortunately, the financial services industry is still littered with too many of these miscreants.
On the other hand, if you are lucky enough to hire an advisor who is looking out for your best interests and not his/her firms products, the 1% fee is a steal.
I can personally attest to this fact. My mantra to clients is: Your assets are growing but your time is shrinking, what are you going to do?
Making sure protecting your time by increasing quality of life is the holy grail of a financial plan.
Many clients have gone from reluctantly taking vacations to booking them on first class flights.
My reasoning is taking long trips in economy class can destroy the first couple of days of vacation due to lack of sleep combined with a significant time zone change. Traveling first class can buy 48 hours of more enjoyment for your trip, equating to 10-20% of your vacation time depending on how long you stay.
If you can afford it, do it.
The same goes for home upgrades. The faster you remodel the Kitchen, the more time you’ll have cooking gourmet meals.
Obviously chores like cleaning the gutters, mowing the lawn, etc. are crossed off the list and exchanged for money.
These are dictated by individual preference. One person’s annoying task is another’s pleasure.
Margaret Mead understood the value of time better than anyone. Let this quote sink into your pores.
It is utterly false and cruelly arbitrary to put all the play and learning into childhood, all the work into middle age, and all the regrets into old age.
Buying back time is the best purchase you can make.
The second best is finding someone to make you realize this.
