How can I decide when it's worth it to spend money to save time?

Question

I've recently started thinking that I should spend more money in order to save time. Examples of this include:

• paying to get my laundry done instead of doing it myself
• sometimes taking a taxi instead of taking the subway home

However, I still do find that I constantly spend a lot of time doing things that would take much less time (but at a higher monetary cost). Examples of this include:

• shopping around for 10-15 minutes to find a price a couple dollars lower for something I could immediately buy on amazon.com
• spending hours (probably 10+) cataloging and looking up the value of my old cd collection in order to sell it for a couple hundred dollars when I could have just thrown it out or given it away

It's very contradictory to me (and hard to understand) that I'll often spend a lot of time on something (like the amazon example above) to save a small amount of money, yet I have no problem going out for an expensive dinner or a nice vacation. I'm also at a point in my life where I feel like I don't have nearly enough time (and when I do have free time I'm often exhausted), but I have no financial commitments in the near future so money is relatively plentiful.

I'm wondering:

1. Are there any tips for computing what my time is worth? It would be easy if I was paid by the hour (and could work as many hours as I like), but I'm not. I'd like something better than "gut feel" for knowing when I should spend money to save time (or not).
2. Are the ways I can convince myself to spend more money to save time? I know at times I'm definitely working for under minimum wage by spending so much time to save a little money.
3. Other than laundry and transportation, are there other common ways to gain more time by spending money?

Answer 1

Congratulations. You have learned to "throw money at a problem". Getting home fast or avoiding doing laundry are clear, repeatable, understandable problems and you can figure out your dollar threshold for it.

Unfortunately, the other two examples are not "problems". They are "challenges". The challenge of playing the game of price comparison, the challenge of having a completely catalogued cd collection (selling it is a goal, not a challenge). You probably got a small kick of getting both things completed? I know I used to.

So, there are three ways I can think of to deal with it:

1. Make the challenge into a problem. If you need to buy something right now (e.g. a new water-proof camera a day before the trip), finding right thing becomes a problem, not a challenge, because the alternative is a clear opportunity cost (no camera) rather than a vague (free time). So, look for more 'solve right now' situations and learn from those. Perhaps less free time to get stuff done is an answer as it forces you into satisficing frame of mind.
2. Make a specific challenge and be transparent on whether your choices of activities get you towards that goal. It could be a programming project, a book to write, a daily activity run, etc. Not just "free time" but actual goal that you know you missed on, perhaps even with tracking daily progress. This puts the pressure on prioritizing less interesting things out of your life or making them take less of your time/energy. This, in turn, may cause you to throw the money on things that pure will cannot make go away.
3. Create a challenge around spending money. No, not how many expensive beers you can drink in one hour. :-) But something like deciding to use a virtual assistant and spending your mental/research power on figuring out which parts of your life you can delegate. I believe the 4-hour Workweek has a chapter on that. Then, you get a kick of learning to delegate and mastering new system and as a by-product manage to actually offload a number of less-exciting tasks.

Finally, think about your externalities. I bet when you have trouble substituting money for time, it is because there are some external benefits (again, challenge of beating the catalogues' price games, pleasure of someone's company, ability to boast doing/living-through a situation, etc). Identify those to yourself and your brain will suddenly be a lot clearer on how to calculate the true total-reward and the appropriate tradeoff cost.

As an example, I am spending a large amount of time on this answer instead of much-required sleep because I find the question resonating and I suddenly have the answer singing in my brain. And, to some degree and if I express the externalities even more bluntly - because Stack Exchange's gamification implementation is rather effective. :-)

Answer 2

Other ways to spend money to gain time include:

• hire a cleaning service
• hire a dogwalker
• use a personal shopper
• use a travel agent
• have your drycleaning picked up and delivered
• have your car picked up and delivered (for maintenance)
• have your groceries delivered (either from a grocery store or a CSA)
• have your meals delivered

This last is a bit different from the others, so it gets its own section. One way to trade money for time is to work less. Right now, my spouse is a part-time homemaker, part-time freelancer and it is fantastic to not have to dive right into chores when I get home from work or juggle vet visits with meetings. If he gets a full-time job that pays close to mine, I'll likely drop back to 1/2-3/4 time.

Answer 3

If I was in your situation, I would probably first try and figure out how much 'free' time I want or need. What is this 'free' time going to be used for?

• Is it just to sit back and relax?
• Do you want to work on a hobby/project?
• Do you want to travel?
• Do you want to spend more time with family and friends?

Once you have a number in your head, it will give you a better idea of what your time is worth.

You can pay people do things for you, or you can improve your own efficiency.

I personally enjoy listening to audio books and brainstorming ideas in my journal, so I don't mind the longer waits that are required for public transportation. I typically do my grocery shopping while I wait for my clothes to be washed at the laundromat.