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Small Business Tip: What is your time worth?

Have you ever wondered what your time is worth? I mean if you had to put a price on what you do what would you charge? Maybe you’ve even questioned if the amount of time you spend working your home business is really worth it, or if it really is just a fun hobby.

As entrepreneurs we wear many hats, and for years I have wished that I had some clue as to what my time is actually “worth”.  Working from home is so different from having a “job”.  When you have a job, before you begin to “punch the clock”,  you negotiate the terms of your employment, and you know exactly how much time it takes to earn X number of dollars.  As a home biz professional it’s not that simple.  In fact knowing that your efforts are “worth” your time is something that we all deal with at one time or another.

The question really is what is your time worth?  I mean, how do you know what the value of your time is?  How do you determine if your “to do list” is really DOING anything at all? These are the questions that haunt every home biz owner aren’t they? And I found a great tool that helped me.

A while ago I ran across this really interesting exercise in Jim Cockrum’s Blog that struck a chord.  I found it to be really helpful in answering this very question, and I wanted to share it with you. See what you think  as you put your numbers in, and find the answer to the question “what is your time worth“?

The Exercise:

Get a pen and paper and do this right now – it will take you about 30 seconds. If you are bad at math grab a calculator.

First, write down your desired annual income.
Next divide your desired annual income by 52 (the number of weeks in a year).
Now divide the resulting number by the number of hours you want to work weekly (on average).
The number you get is your desired “Hourly Worth”.

Find a nice clean 3X5 Card and hang that dollar figure somewhere.

Any task/business/venture you are “working on” ask yourself  if  it’s actually moving you closer to your “Hourly Worth” goal. And if it’s not, then you should either:

1. Stop doing it as soon as possible or

2. Outsource to someone else or

3. Stop calling it “work”  and recognize that it’s a hobby or habit

For Jim, his number is $700. If someone wants an hour of his time these days that’s also the price.If he’s going to “do” something it needs to have a similar value. He goes on to say the following:

“This is why I’m so interested in “multiple-income-streams” that I can launch and forget. It’s getting harder and harder for me to justify working on answering tech support emails of any kind (or nearly any email for that matter). I don’t make my own bank deposits, mow my own lawn, or even do the majority of work associated with my eBay business”.

It’s interesting that all of  the  jobs he lists above are outsourced because they do not meet his criteria of $700 per hour of work.

As entrepreneurs, we all know that time is a precious commodity. And as we become more financially successful the more valuable it becomes. And while your number may be less than Jim’s, the point is that your time is valuable.

In order for you to continue to grow your business and not let it take over your life, this exercise will help you keep in mind that your time is worth something so choose what you spend it on wisely!

Great stuff to think about…

 

 

~Judy Davis, the Direction Diva is a motivational speaker, author and entrepreneur as well as a military life and teen suicide prevention expert. Co-founder of DASIUM, Judy’s books Right Side Up  and Warning Signs: Is Your Teen at Riskare go to resources for families and her websites are filled with tips, inspiration and resources for those looking for direction. Connect with Judy at TheDirectionDiva.com

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