Manage your time more efficiently when you know what your time costs.
Put a Price on Your Time
Sure, you know time management is important. You can get more done if you manage your time efficiently. Yet knowing you will be able to get more work done if you take charge of your time, may not be much of an incentive to make changes. Putting an accurate price on your time, however, can spur you to pay more attention to time management.
If you have the kind of business where you bill clients by the hour, you may value your time at the hourly rate you bill your clients. But there are many non-billable activities that you have to spend time on to run and manage your business. Marketing, traveling to a customer’s location, and recordkeeping are just a few of those necessary time-consuming tasks that you can’t bill for.
In addition, you have ongoing costs to pay regardless of how many hours you spend working for clients. They include things like business and health insurance, Internet access, phones, website hosting, and maintenance. Use the calculations below to place a more realistic value on your time and on the cost of interruptions.
Cost of Time Calculations
To correctly value your time, you need to take all those items into consideration. Here’s how to calculate it.
1 – What is your annual salary or income from your business ______
2 – Yearly cost of health insurance and other benefits ______
3 – Annual overhead expenses (phones,insurance, Internet
services, utililties, rent, etc.) ______
4 – Other annual expenses ______
5 – Total annual expenses for your work ______
6 – How many weeks a year do you work? ______
(Do not include vacation time)
7 – How many billable hours a week do you work? ______
(If you don’t bill by the hour, enter the total number of
hours a week you work.)
8 – Total billable hours a year (Multiply line 7 by line 6.) ______
(If you entered your total hours a week instead of billable,
this figure will be your total hours a year.)
9 – Cost of one hour of your time ______
(Divide line 5 by line 8.)
11 – Cost of 15 minute interruption ______
(Divide line 9 by 4.)
When you’re done, calculate how much it costs you each month if you waste 15 minutes a day searching for things on your cluttered desk.