Time Is Money: Opportunity Cost

Time is a resource, it will fade when it is not used. Unlike every other resource there is no way to renew it.
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Time is money, right?

Many have heard the phrase “time is money.” However, they have no idea of how to spend such a valuable resource. You may be spending it wisely, considering the fact you are reading a financial literacy blog it is at least likely you spend time fairly wisely. Every second is an opportunity to learn, earn, and grow.

Economics is a social science, but like physics, it still takes time into consideration. This is called opportunity cost. The official definition usually applies to opportunities businesses take over others while considering which opportunity will produce more profits. However, this applies to individuals as well. When an individual spends time on anything, they take time away from something else. For instance, when you binge Netflix, you are not making a business, learning a skill, or finishing basic chores.

How Is Your Time Being Wasted?

I enjoy watching a good show as much as anyone, but you will not make any money watching Netflix. Last I checked there is no job for that (at least, not the way people typically do). And aside from sleep, that is what most people spend their time doing. Please make sure sleep is the one activity you spend the most time doing. That fact is not meant to guilt anyone, you need sleep. It is debatable how much though, but it is likely you need at least 6 hours.

Source: Bureau of Labor Statistics

Instead, use that time to learn new skills instead of watching TV, or at least low quality TV. You know which ones I am talking about, usually titled: Something Something Life of Something Something. You should read books telling stories of people, or even some other media including high quality TV. I have listed many books that I highly recommend to gain financial skills.

But how can reading make you successful? According to The Business Insider, practically every successful person primarily reads during their free time. Warren Buffett reads anywhere from 600 to 1000 pages a day, and even then he probably has only touched far less than a millionth of a percent of all knowledge ever written down.

So We Should Just Read?

No, reading is meant to give you both knowledge and inspiration, both are completely worthless when they are not applied. Use that knowledge to try something, maybe you will gain skills that will become a business. For instance, I have an idea to start a pipette cleaning business, and all I had to do was apply myself after reading a few manuals and journal articles.

Other Good Ways To Spend Time For Your Finances

Not everything needs to be about business and finance to save you money. How often do you eat out? Don’t tell me, if you’re American, it is a lot. Try cooking. While there are plenty of ways to read how to cook, I believe it is a skill best obtained by practice. Since the Mrs. and I are good cooks, we rarely feel like going out to eat considering we can make such good meals, and when we do, we try new things to inspire new recipes. This puts more money in our pocket since going out to eat costs over fourfold.

There are other hobbies which can help you save money without starting a business. One that works for me is hunting. I started deer hunting with my family in Virginia last year. It was the first time I went, they went a few times before, but I was understandably busy. Then I spent two hours in a tree stand and downed a buck with a single shot. That was over 30 pounds of very high quality meat (just a small buck, nothing trophy worthy). I shared some with my family and the amount we had left gave us plenty of meat for two months. We saved a few hundred. However, I understand that this is a not always the case, not all hunters get a deer each season.

To anyone who can relate to that, don’t worry, you will get one. There is luck involved so skill is not everything. Plus, many experienced hunters gave me very good advice. I can provide that knowledge, but not directly on this post. Subscribe below or leave a comment and I can reply or even write a post about it.

Recreation

Even if there is no way to actually make money off a certain opportunity (or at least a legal one) who says that it is still a waste of time? Last I checked even successful people need some form of entertainment. It has been found that leisure and recreation is good for your mental health, especially if it involves physical and mental exercise.

However, that does not mean you should do that almost as much as you sleep, or that you should be careless about the quality. It is ok, even good to have entertainment, but it can be better if you can transform it into inspiration. I mentioned in my post about books, how a novel meant for recreation inspired me to write more of my novel.

Another instance is Mark Zuckerberg, who learned how to program by playing video games and later building a video game when he was a child. Note, he did not just play video games, he used those opportunities to be inspired and later learn how they work. You must not just recreate, but create as well.


Final Thoughts

Is time actually money? Not always. However, time can easily be transformed into money. The key to transforming time into money is your passion. You will not find your time financially fulfilling if you do not make your time fulfilling. For example, if you hate hunting, and I respect your opinion if you do, do not hunt. You can find other ways to spend your time such as gardening, writing, filming, etc. Make your time yours and the time you spend will help you forge your wealth.

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