"Let's get this done quickly because time is money." Who hasn't heard this phrase at least a thousand times? And it's true. Every minute wasted costs us valuable time that could be turned into money - that's why we're looking to be efficient at whatever we're doing. And we can scale it: The more time we spend on doing certain tasks, the more money we usually get in return. Though, how much time is it worth sacrificing for money? And what can we learn from this correlation?
Certainly, money can make us happier. It allows us to buy the things we want and therefore increases life satisfaction. But only to a particular point. Once we're able to afford everything we like and have a solid safety cushion, more money doesn't do a lot. I mean, seriously, what would you do with an extra 1000 € per month which you have absolutely no use for? You could donate it, that would make sense. But other than that? There aren't a lot of useful options.
There's a correlation between happiness and money up to an annual wage of 75.000 $.
Economist Angus Deaton and psychologist Daniel Kahneman at Princeton University found that there's a correlation between happiness and money up to an annual wage of 75.000 $. Every number above doesn't make a difference anymore. On the other hand, it makes a huge difference how much time you got in your life.
What would you do if you had all the time of the world? Probably a lot of things, right? Maybe travel the unknown, learn new skills, make that startup-idea reality, pursue world domination or just take an afternoon nap. The possibilities never end. You can never have enough time. And since life is limited anyway, so you might as well make the best out of it.
When you think about what's more valuable - time or money - the answer is obvious. As long as you earn enough money to afford a decent lifestyle, it's definitely time. And once you adopt this mindset, your perception of money will fundamentally change.
It's a small shift in mindset but a huge step for your day-to-day life. Especially when it comes to your spendings. Let's look at a practical example: For 30.000 € you could either buy yourself a beautiful car (which you will then use to drive to work every day) or you could use the money to take a year-long-break travelling the world. What would you choose? What do you think would add more value to your life? Now, let's not generalize here. If you love cars and that's the car you've dreamed about ever since graduating from college, then go ahead and buy it. You will enjoy it a lot and it'll be a worthy investment. But if you purchase it for temporary satisfaction and because you want "a nice car" for whatever reason, think twice.
Currently, more and more people are realizing this. With all the possibilities of the 21st century, most physical items don't add that much value anymore. Experiences (and extra time) simply offer a way better ROI, to say it in business terms.
While mindset is all fine and good, let's look at some more practical tips. How can you really use your money to buy time? By reducing your need to sell your time - which in return means earning more money. But how can you do that? There are four paths you can take here:
It's the most obvious strategy - but possibly also the hardest one to execute since you want to work less, not more. Diversifying your income and discovering new sources for making money can boost your income more than a single source ever could.
The more you earn, the more tempting expensive purchases will become. Because hey, you got the money, right? In that case, stop for a moment and rethink if you really need that item. If you spend all your additional earnings, you'll put in all your extra working-hours for nothing. Instead, you might want to reduce your usual expenses and make room for useful investments.
The logical step after earning additional money is to save it. Savings give you the option to get away from your income-producing activities when you need or want to.
However, don't save all of it. Once you've built up a solid safety cushion, it's much more advisable to invest your money into real estate, stocks or other assets which will accumulate and turn into even more money.
Spending money so that it multiplies itself: That's investing - and you can invest in a variety of different assets ranging from stocks to real estate to fonds. And even though it might initially seem difficult, investing is an incredibly useful skill to have. You'll earn more money with less effort - giving you the option to "buy" yourself even more time.
Education is also an investment which - in most cases - will equip you with a certain rate of return. Whether you learn to manage your business more efficiently, communicate arguments in a better way or invest in the stock market - education will help you spend less time on certain tasks, thus leaving you with the option to use that time for things that matter to you.
What is money, really? It's time. Which can be used to make money and for unique experiences which will shape your life forever. Once you understand this principle, you can utilize it to make your life better. It will make you rethink your purchases and teach you the value of freedom and time.
Investments in yourself can have an incredible impact. And since we're talking about money here: We (the female factor) have a huge event coming up on November 8th called limitless experience. During this one-day conference, you'll learn about all the important aspects of money from financing your business to investing in stocks. and get your today!