What’s a physician’s most valuable asset?
There’s a lot to choose from (education, job impact, salary, etc.), but many would agree that their most valuable asset is time—the time they have to build a fulfilling career, nurture relationships, engage in hobbies, and more.
Your time is valuable—but do you know how much? And how can understanding it change your relationship with money?
What’s Your Hourly Rate?
Most people don’t think about their time in terms of dollar signs—and sometimes that’s a good thing, like when you’re unplugged and on a much-needed vacation or decompressing on a Saturday night.
But other times, it can lead to spending your precious resources on things that don’t add value to your life, like weekly meal prepping, endless loads of laundry, DIY home repairs, and more.
How much is spending time on tasks you don’t enjoy costing you?
Calculating the average hourly rate for your time can be an enlightening exercise. Here’s all you have to do: divide your salary by the number of hours you work each year. Let’s look at an example.
Say you’re a physician who makes $300,000/year and you work about 50 hours a week, so 2,600 a year. Using the simple formula, you’re looking at about $115 an hour.
So, if you spend 5 hours a week cleaning your house and doing laundry, that costs $575 of your time. Since you could likely outsource that task for less, it may make sense to consider that route.
But keep in mind if you enjoy the task, like cleaning your house or cooking as a family, then it may be best to stick with it. If you’re only doing it because it needs to get done and you could hire someone for less than your hourly rate, consider outsourcing and spending your time on something you enjoy, such as time with family/friends, time for yourself, and more.
If you’d like a more in-depth analysis of how much your time is worth, check out this free resource.
Outsourcing tasks that don’t add value or keep you from other things could be a fantastic opportunity to use your wealth in more meaningful ways.
Time Is Value—Outsource To Maximize It
When you read the headline, your mind may have wanted it to say, “time is money,” but let’s reframe the concept to “time is value.” Your time has weight and significance, and it’s one resource that’s finite—you can’t get more of it.
So how can you optimize your time?
Understanding Your Time’s Value Is An Excellent Decision-Making Tool
When you know how much your time is worth, you set yourself up to make decisions that further your life and goals.
Should you pay someone $50 to clean the gutters, so you don’t risk hurting yourself on a ladder? Would using a meal kit service reduce your stress after work? Does it make sense to have someone help you with the cleaning to maximize time with your kids?
Think about tasks that take up a lot of time but don’t offer much value in return. What could you do instead of going to three grocery stores to get all the things you need for weeknight dinners? Maybe you could go to your child’s sporting event, spend time volunteering, catch up with friends, set a date night with your spouse, etc.
Let’s try an exercise. Write down the areas of your life where you find the most profound “return” on your time.
- Helping patients
- Growing deeper into your profession
- Quality time with family and friends
- Pursuing a hobby
- Maintaining your health (eating healthy, exercising, etc.)
List the activities where you feel you make the best use of your time throughout your life. For example, spending a couple of hours a week on continuing education is an excellent use of your time as it furthers your skills and helps you maintain your license. You may also find that you love cooking after work because it enables you to relax and separate yourself from the “office.”
Now, list the things that don’t provide a strong “return” on your time. Ask yourself,
- Is there a recurring task you have to do but dislike?
- Does this activity take you away from spending time on anything from the list above?
- Can you outsource this task to someone else?
If you answered yes to any of these questions, it might be time to look at outsourcing.
Sometimes it’s challenging to think about outsourcing a daily task like cleaning, laundry, meal prep, home renovations, etc., to someone else, but consider how it could impact your everyday life.
Reclaim Your Time Off–A Case Study
Physicians are busy people, making their time off precious.
One client of ours is a doctor and mom of three kids. She realized that she was spending so much of her time off knee-deep in laundry and picking up toys scattered around the house.
The mess led her to not enjoy the time in her home. She found the clutter stressful and the never-ending load of laundry disheartening. It was time for her to reclaim her space and enjoy her house again.
To that end, she hired a household manager service to clean her house and do the laundry once per week. Spending the money on this task gave her so much in return, a renewed love of her home and quality time with her kids.
You’ll likely find the best result when you outsource tasks that directly impact your life, and that could look different for everyone. So, if you enjoy cleaning your house because it helps you detox and reset, then, by all means, do it! But if cleaning your house consistently takes you away from the things you enjoy, consider outsourcing that task.
How To Add Outsourcing Into Your Cash Flow Plan
The money required to outsource these tasks doesn’t grow on trees, but you already knew that! So how can you make room in your cash flow plan for them?
First, it’s important to align your spending with your life and values; spend money on the things that make your life better. While you may think that means going on more vacations or buying a nicer house, it could also mean spending money to free up your time, like outsourcing tasks you don’t enjoy.
To do that, you may need to rearrange other spending habits. If, for example, hiring a house manager is a top priority, you may have to cut back on other areas like shopping or entertainment. We can work together and look at the numbers to create a cash flow plan that works best for you.
Spend Money Where It Counts—A Case Study
We work with a wonderful husband and wife doctor duo who both never enjoyed meal preparation and cooking. They both maintain heavy workloads, and cooking becomes such a burden at the end of the day.
Since they were so exhausted from the day’s work, that led to more takeout for convenience, but consistent takeout had them feeling bad about neglecting their health—especially as physicians!
At first, they tried a meal kit, but the preparation was still too much for them after their busy shifts. So, they found a service that allowed them to hire a chef to do a week’s worth of grocery shopping, come to their house, prepare the meals for them, and leave simple reheating instructions, so they could eat quality meals without having to shop, prepare, and make them.
This service works perfectly for them and their lifestyle. Plus, it hasn’t derailed their spending partially because they aren’t spending the same amount on takeout and partly because they valued this service so much and made dollars available for it.
We would love to help you budget for the things that will make your life better.
Create Wealth That Matters
At Vestia, one of our goals is to help clients create wealth that matters.
What does that mean?
Building wealth is so much more than paying bills or eliminating debt—it’s about the choices, opportunities, and freedom that come from a discipline strategy. Your wealth should have a greater purpose—retire early, put your kids through school, travel the world, etc. We want to help you make that purpose come to life.
As you consider what this means to you, ask yourself,
What would you NOT do if money wasn’t an object?
Your answer can be a valuable exercise to understanding what’s most important to you. When you know what that is, we can help direct your resources to make those areas shine.
Are you excited about outsourcing something in your life this year? Set up a time to talk with our team today!
Investment advisory services are offered through Vestia Personal Wealth Advisors, Vestia Retirement Plan Consultants, and Vestia Advisors, LLC. Securities are offered through Ausdal Financial Partners, Inc., 5187 Utica Ridge Rd, Davenport, IA. 52807 (563)326-2064. Member FINRA/SIPC. Vestia Personal Wealth Advisors, Vestia Retirement Plan Consultants, Vestia Advisors, LLC, and Ausdal Financial Partners, Inc. are independently owned and operated.
This material is intended for informational purposes only. It should not be construed as legal or tax advice and is not intended to replace the advice of a qualified attorney or tax advisor. This information is not an offer or a solicitation to buy or sell securities. The information contained may have been compiled from third-party sources and is believed to be reliable.