I had a meeting over lunch with an old friend and colleague and we got into a discussion of putting the proper value on our time.  For a business person who makes their own decisions on what to spend their time working on, this is a hugely important question…

The first step is coming up with a ballpark of what you need to earn each month in order to maintain your preferred lifestyle.   For our example, let’s say that you need to earn $10,000 (before taxes) per month and that is your target.    

Write your Monthly Income Target here:   $ ________________

Most people are not productive with every single hour they spend working, so you need to establish a number of “core” maximum productivity hours that you are going to diligently protect.  These “core” hours you will devote completely to earning the income to support the lifestyle you want.  You can take care of some of the other less valuable, yet necessary, stuff in the other “non-core” hours of the day.  For example, let’s say you are going to work 5 hours x 20 days a month as your “core” hours, this would be 100 “core” hours a month.

Write your Monthly “Core” Hours Target here:   _________________ hours  

Note: Your long-term goal is to pay other people to do the lower value things for you.  (Bill Gates doesn’t take his own car in for oil changes or service visits.)  This will free up more “core” hours or more free time depending on your lifestyle preferences.

Once you have the Income Target and the Core Hours Target you can divide the $ by the hours to get a target $/hour value for your time.  In the example of $10,000 per month and 100 “core” hours a month, the value of your core hours needs to average $100 per hour to meet your income target.  If you strive to make each of the hours be worth at least this amount then you will exceed your goals and this will allow you to pay people to do more things for you- starting with low-value things you dislike or are not good at.

Your job is now to find enough tasks and projects to work on that are worth at least this amount of money…  Ask yourself “What can I work on next that is worth at least $X per hour?”  This is a different question than asking “What should I work on next?”…

And once a week, spend an hour planning out what new ideas you can come up with for tasks and projects that will deliver more than $X per hour.  This planning/brainstorming time is likely to be worth more than $10X per hour in the grand scheme of things.

Your thoughts are welcome in the comments below…