Time is more important than money. You think that you know this, but you probably don’t act on it as much as you could. If you spend your time buying material things then you are using up the one thing that can make you happy (time) on things that definitely don’t make you happy (stuff).

In terms of happiness, time matters a lot more than money. The most important factors of happiness — the quality and intensity of your relationships, how often you have sex, how much sleep you get — all come from an investment in time rather than money. (For those of you who think money buys sex, stop yourself: “It's true that money impacts which person you marry,” says professor of economics David Blanchflower, “but money doesn't impact the amount of sex you have.”)

So if you’re considering taking a job that requires long hours so that you can make a load of money, don’t do it. Authors of the book Your Money or Your Life, Joe Dominguez and Vicki Robin, present a fresh way to think about this tradeoff:

“Try turning around the old maxim ‘time is money’ and look at it this way: ‘We pay for money with our time.’ Those hours on the job (or our partner’s hours on the job) are what bring money into our lives. Money, by definition, is simply something for which we choose to trade hours of our life — what we’ll call ‘life energy.’ While money has no intrinsic reality, our life energy does — at least to us. It is precious because it is limited and irretrievable, and because our choices about how we use it express the meaning and purpose of our time here on earth.”

This way of thinking gives you a more concrete way to value your time. And, once you start thinking this way, you can see the astounding ways that people undervalue their own time.

While you’re thinking about what is worth giving up your time for, take a look at the research about materialism; fantasizing from your cubicle about the grand purchases you will make actually makes when you finish work will actually make you UNhappy.

“Seeing the BMW may make you feel unhappy, but psychological studies show that obtaining the BMW would not make you happy,” says Gregg Easterbrook, psychologist and visiting fellow at the Brookings Institute. And the more emphasis one puts on materialism the more likely that person is to be depressed and anxious. So look, it’s a wild goose chase with the stuff — you will never buy the thing that’ll set you on the happiness track.

Most people, when looking back on their lives, wish they had done things that cost time, not money. The Royal College of Surgeons in Ireland, has conducted long-term research about terminally ill patients. The findings: “It is much more common for people to regret not the things they did, but that there were so many things they didn't have the time to do.” So consider seriously the idea of making more time for yourself by agreeing to earn less money. And if you have to work a lot, use your money to buy time — takeout food, a cleaning service, a personal assistant.

Think of all the time you spend planning how you spend your money — balancing your checkbook, preparing taxes, reading financial advice. Spend at least that much time and energy planning how you will spend your hours. People know that if they don’t pay tons of attention to how they spend their money then they’ll never be rich. But think about this: If you don’t pay tons of attention to how you spend your time, you’ll never be happy.

Hat tip: Occupational Adventure

29 replies
  1. Nitant
    Nitant says:

    Great article Penelope.Striking a balance between money and time is indeed a skill.But i think that your missing something here.What abt people who are happy at doing the ‘work’ that they do.They cant be blamed if they do gain happiness from it,where money is just an added bonus.
    However,yes i would agree with you that you shouldn’t overwork for gaining materiliastic pleasures.They NEVER make you happy.You might have the biggest house,the best car but if u have no time to enjoy them with your loved ones,they dont matter.Knowing where to draw the line takes courage as humans tend to be greedy
    when it comes to money.We are afraid to try.But i wish that people would spend more time with their loved ones sharing their love .This would lead to a much happier and fulfilling life indeed.Coz after all, everything does boil down to gaining “HAPPINESS”.

    * * * * *
    There is a lot of research about what makes people happy and what has no impact on our happiness. Personal  relationshiops have so much more impact on our happiness than work does — even if we love work — that it is like comparing apples and oranges. Personal relationships are way more important than work if you are looking for happiness.

    –Penelope

  2. AjiNIMC - wrote about "Questions for your employer (Hiring Manager)"
    AjiNIMC - wrote about "Questions for your employer (Hiring Manager)" says:

    >> So if you're considering taking a job that requires long hours so that you can make a load of money, don't do it.

    This is an attitude, some people always make it to the quality, quality needs personal attention, personal attention needs time. To make anything good you need time. A person who is able to do produce good get more work and gets promotion. Good people are always short of time but some know how to manage time and some don’t.

    How to manage time at a higher level of Job
    – Spend good time to recruit good people
    – Empower them
    – Do not catch fish for them, take time to teach them fishing
    – Outsource some part of work.
    – Limit goals or rather focus.
    – Avoid multi tasking

    Smart people are not those who avoid high paying and high demanding jobs but are those who know how to handle things. Know yourself, know your job, know you family and the do a planning.

    Also you may like to go through http://www.ted.com/tedtalks/tedtalksplayer.cfm?key=d_gilbert

    Take care,
    Aji

  3. Nerd Guru
    Nerd Guru says:

    I once had a financial adviser tell me that you need to spend as much time planning for retirement as you do planning our vacation. It never occurred to me to turn that around to create a statement about work-life balance. Great ending two sentences, that becomes a quotable for me.

  4. oldguy
    oldguy says:

    There are two points mixed together here that really ought to be kept separate:

    1) Don’t waste your money on stupid stuff, because stuff won’t make you happy.

    2) Don’t take a job that requires lots of hours.

    The first point is dead on. Americans spend too much money on stupid stuff. The stuff does not make them happy, and they often end up with debt that actively makes them unhappy.

    The second point is a lot more complex. Sometimes it makes sense to work hard for a while, save the money you make, and move to an investment based earnings stream where you have lots more free time for the rest of your life. It depends on circumstances and absolutely depends on not throwing the money away or getting locked into the peer lifestyle (there’s nothing sadder than people who have made six figure incomes and yet manage to have no savings), but on occasion a little hard work on the front end can free up lots of time later on.

    * * * * * * *

    I a not sure I see the point in hard work on the front end for free time later. I don’t think people want free time so much as meaningful time. So why not make both the front end and the tail end meaningful time? Seems definitely do-able.

    Also, I can think about about ten million things that are sadder than people who made six figures and have no savings. I have been one of those people. A million things can cause the savings to disappear. And I have news for you — it doesn’t affect how happy I am one bit. How well I get along with my husband on a given day affects my happiness way more.

    –Penelope

  5. Jenflex
    Jenflex says:

    Oldguy: I like the way you separate the two points, but my issue with working many hours is that so few people approach this decision at a conscious level. It’s more like an addiction…starts slow, then creeps in to take over your life. Then, you wake up one day and realize all the stuff you didn’t do.

    That said, simply deciding not to work many hours doesn’t guarantee those hours will be spent building happiness.

  6. Maureen Rogers
    Maureen Rogers says:

    Penelope – Nice job.

    Having pulled out of full-time corporate a couple of years ago, and having now elected time over money, I realize that one of the traps for me when I worked full-time was “rewarding” myself to make up for dissatisfactions at work. Why not buy that periwinkle blue sweater, even when you have three of them just like it at home? You deserve it.

    I was never a true spendaholic, and have always pretty much been able to live debt-free, yet I could see how easy it is to succumb to the spending trap.

    I tell people now that I have half the income and about 10 times as much life satisfaction. An excellent trade-off, and I don’t even miss buying new sweaters.

    However – to a variation on “oldguy’s” point, I don’t know whether I could/would/should have made this choice 20 years ago if it had meant foregoing home ownership, etc. It’s an easier choice when the mortgage is paid off.

    * * * * * * *

    Great point, Maureen. I find that I do the same thing with cookies. If I am working really hard and the rest of life is falling apart, I somehow convince myself that cookies will compensate me.

    And, of course, they work as well as a blue sweater, which is to say, not at all.

    –Penelope

  7. Rowan Manahan
    Rowan Manahan says:

    Lovely slant on the age-old problem Penelope. I remember discussing “rushing around all the time” with my grandmother, who was born when Victoria was still on the throne and who died at the age of 96.

    She talked of a gentler time, when people savoured their leisure and outsourced all the mundane tasks they could afford to. It was not unusual in 1930s Ireland for a comfortable middle class family to have a maid, someone who would cook part time, and certainly a gardener/handyman to do all the heavy lifting, again on a part-time basis.

    Gran, who was a very astute woman, pointed out that she noticed lots of people in the 1990s were paying people to do those mundane tasks – so they could go out and work more …

    Something awry with that model methinks.

    * * * * *
    Thanks for the comment. Really makes me think….

    –P

  8. peter vajda
    peter vajda says:

    This is a great post, and thanks, Penelope….a post that focuses on a major “issue” for many of my coaching clients…the role of money in their lives and their relationship to money as it affects their lives.

    A major question we explore is the role of money in one’s search for meaning. For many, money is a major factor that keeps them in a prison of sorts…what they choose (really, feel forced) to do in their work lives, in their relationships and in their so-called quest for happiness.

    There’s no question that our personality has a need for security. As a human in a material world, we need money to survive. If we don’t have enough for basics, our lives cannot function. At the same time, with too much emphasis on the material, we lose the spiritual awareness that brings meaning and fulfillment. The key lies in the balance.

    We like to inquire into the question of what draws most of our energy, intention, attention and time: spiritual growth or money? We review our life, up to now, under a microscope and reflect on (and journal on) the balance or lack of balance of these two in one’s life. What do we see? What are we learning about our priorities vis-a-vis money, time, relationships, fun, etc.?

    We spend time reflecting on the notion that money and things are not something we use to fill a lack, but as tools to help one more fully express one’s self and realize your potential. As Francis Bacon said, “If money be not thy servant, it will be thy master.” So, we explore the ways in which money rules one’s life, how money affects so many of the (often unconscious, self-defeating and self-sabotaging) decisions one makes, how money forces us to compromise things we really value, how money can adversely affect one’s relationships, one’s health even one’s self-respect (as Suze Orman says, it’s about self-worth, not net worth).

    One important place we start is with beliefs around money (beliefs we created in childhood, listening to parents, friends, teachers, clergy, etc.) talk about money (usually in a fear-based way) and explore these beliefs we hold around money and prosperity abd see how these beliefs drive our do-ings and be-ings. So, it’s important to ask, “How do you think and feel about money?” And, why? Really, why?

  9. Gloria Hildebrandt
    Gloria Hildebrandt says:

    Writers and possibly other artists have long connected money with the ability to “buy” time to work on creative projects. Getting a grant or a gift of money can free you for a few months. Being self-employed brings the dreaded “feast and famine” cycle, but there’s a benefit when you can use time that’s not required for paying work, to do your own work. That can be one of the real advantages of being self employed. This can only work well when you know that you will have paying work again before you run out of funds.

  10. kathy k.
    kathy k. says:

    Penelope, please add another link to the commencement address by the late US Supreme Court Chief Justice William Rehnquist. It’s hard to put it better than he put it. He said, “Those who are putting in overtime at the job tell themselves that they don’t have time now, but after they have finally made partner, or finally saved another so many dollars, then at last they will have the time and they will take advantage of it. This is a slippery slope to tread. Some things in life can only be done during a certain part of one’s life. You can only be a parent to a young child while the child is young. Children grow away soon enough from their parents, and you can’t tell an eighteen-year-old to stay home tonight because Dad finally has the time for him. The time to help out a friend in trouble is now; your help won’t do that friend any good two weeks from now.” I am a boomer tax-accountant who worked a lot of hours from December 1 – April 15th each year. After reading his speech, which was a link from this Blog, I realized that the time to take my children to spend Christmas or spring break with their grandparents in Florida was when my parents were both alive and living in Florida. But the job didn’t permit this. We finally made the trip to Florida (in the month of August) three weeks before my dad died. The time to travel to see my grown children, spend time with my 80 year old mother, siblings, a disabled friend who can’t drive, etc. etc. is now. I’m so glad that I found this speech – it has changed my life. His speech concluded with this statement: “The most priceless asset that can be accumulated in the course of any life is time well spent. I wish you all much of it.”

  11. Greg
    Greg says:

    kathy k., what an incredible post. What you wrote is why my wife left her lucrative career to be a stay-at-home mom, why we avoid debt, how we decide how much time to spend with friends and family, and why we are especially particular with how we spend our holidays.

    Just reflecting back on my work life (I am 44), there are only a few times that my professional standing would have been marred by taking time for myself or family. In fact, I have had the privilege of working for a number of employers that thought it was great I took time for important things. Of course I always had a plan on how my area of responsibility would be handled (covering a shift, working early a couple mornings, etc.) so I made it my problem, not theirs. But even in these types of environments, there were some that made themselves a slave to their work.

  12. Penelope Trunk
    Penelope Trunk says:

    Wow, great comments everyone. What really strikes me here is the number of people who have a good amount of experience in their career and still recommend taking more time away from a career. In hindsight, it’s so much easier to see that taking time off would have been fine. It’s so hard to see it in the moment.

    This comment string is a great example to me of why a multigenerational community is so valuable.

    –Penelope

  13. Helene
    Helene says:

    I think the Europeans embody this concept whole heartedly. With 6 to 8 weeks of vacation per year, 35 hour work weeks, siestas in the afternoon, smaller apartments, smaller cars, hostiles, long dinner conversations….

    It is true, money costs a lot of time and life energy. Time is the ultimate commodity.

    Best,
    Helene Taylor
    The Modern Woman’s Divorce Guide
    http://www.themodernwomansdivorceguide.com

  14. Tom O'Brien
    Tom O'Brien says:

    Just got back from another extravagant vacation and went out to lunch with an old friend. He is an acquirer of stuff. He can’t believe how much we spend on vacation – I can’t believe how much he spends on stuff.

    I collect experiences and time with my family, he collects stuff.

    Tom O’B

  15. Brian Johnson
    Brian Johnson says:

    Flipping the “time is money” axiom on its ear is really clever. Authors Paul Hunter and Amery and Hunter Lovins come at this from a slightly different perspective in their book titled “Natural Capitalism”. Our modern systems for measuring economic outcomes just aren’t set up particularly well for capturing the value of time and especially a person’s level of happiness during the time spent doing something. Thus, it’s extremely difficult to take these factors into consdieration when evaluating a Profit and Loss Statement or looking at your check book register. There simply isn’t a column for “happiness achieved” and even if there were, how would you measure it?

    I completely concur with your reaction to the comment about working now for free time later. My personal history includes a father-in-law that worked 15-30 hours of overtime every week for 20+ years in a factory in preparation for a really spectacular retirement to be spent on a boat in the gulf. It was a great plan until he was killed on the job in an industrial accident at age 44 on Christmas Eve. I can’t say for certain, but I’m guessing he might have done a few things differently if he would have known how it would end.

  16. bloggadocio
    bloggadocio says:

    1st time reader and commenter here – this particular post is v. relevant to a negotiation I just went through for a new job. I’d be curious to hear whether there’s a difference in how males v. females approach a time v. money balance?

  17. Prashant
    Prashant says:

    Out here in India, my company offers a (paid) bus service for the commute to office. Usually it takes 45 – 60 mins each way. I like to use this facility instead of driving – in the morning, I read the newspaper in the bus. On the way home in the evening, I sleep. This ensures that I am fresh and energetic when I reach home, and I am able to spend my time better with my family.

    I’ve been to the US once, so I know the bus thing does not work there – but could it be applied to car pools? Or would it be considered too rude to sleep in someone else’s car?

  18. Joanne Giardini
    Joanne Giardini says:

    Excellent post Penelope. Something I hope we can all hand down in lesson form to our children… I have three kids, just took my work from 5 days to 4 days and they are just thrilled. Like Tom, I’m heading on a cruise tonight for 3 nights with them. I want them to collect experiences, too. We’ve tapered off “stuff” – something I hope they carry with them through their lives.

  19. oldguy
    oldguy says:

    In suggesting building a modest financial nest egg early in life may not be crazy, I didn’t mean to become the spokesperson for neurotic workaholics. I left my (secure and overpaid) office job over ten years ago, and have spent the years since with family first (and, I think, was a pretty active dad before even while working hard – it’s amazing how much family time you can pack in to your life even with a demanding job if you live close to work, don’t allow televisions to be turned on in your home on weekdays and don’t head out to play golf on weekends. The trade offs are not limited to work time versus family time.). Right now, we are living in an old house somewhere in southern Europe, where my kids are getting a chance to appreciate first hand the European viewpoint that life is meant to be enjoyed.

    In my case I’m happier, and my wife is certainly happier, because we have a certain minimal level of financial security. We’re not rich, and ok with the idea that we will never be rich, but having been poor and in debt we take great psychic satisfaction from knowing that if we are prudent and careful we will probably never be really poor again. In our case, no matter what the studies say for other people, happiness is related to not worrying about money (which is very different from happiness being related to how much money you have), which we achieve by keeping our style of living pretty low and having just enough savings to feel protected.

    What I tell my kids is that money is like water – when you don’t have enough to meet minimum needs, it can seem like the most important thing in the world, when you have enough more is not going to improve your life, and when you have too much it can actually be a bad thing. Me, I think if you don’t have enough of a nest egg to allow you to relax a little, it makes sense to spend a couple of years getting to where you can feel secure, but if a different strategy works for you, fine. I will admit that it is, as noted in a comment above, hard to know when you have hit “enough.”

    The Rehnquist quote above is, I think, a great one. When I “knew” Rehnquist (me as a pipsqueak passing him in the halls, him as a Supreme Court justice), he walked the walk in putting family ahead of work even though he had a pretty impressive day job. He was not the first guy in the door, he took time off mid day most days to play tennis with his clerks, and he was out the door in late afternoon before almost anyone in the building. With all that, he got his work done faster than any other justice, on average, and had an impact on the course of American law unmatched by anyone else in the last third of the 20th century (you may not like the impact he had, but the point is that he did world-changing work in a short work day). While he had lifetime security in his job and couldn’t have been fired even if he had spent all day every day at Kelly’s Bar, I’m betting he would have been the same way if he were living off billable hours. It helped that was way smarter than the smart people around him, and it helped that his views on the law didn’t require him to spend time agonizing over issues that he found clear, but mainly he just wasn’t neurotic about pretending to work harder than he needed to in order to get the actual work done. It is amazing how much time people can spend pretending to work, and Rehnquist just didn’t do that.

  20. finance girl
    finance girl says:

    hmmm…yes….esp. regarding buying more crap (people, stop buying crap you don’t need with money you don’t have!)..but…maybe too broad a brushstroke here re: the work component?

    For example, what if (btw this is not me) I love love love my high paying, high demand job, that takes up lots of time and get much reward and satisfaction from it? Well…then that’s a good use of my time.

    Separately, re: buying services to give myself more time, one needs to look at their true motive here.

    If I hire a cleaning service, a gardener, a financial salesperson, am I doing it to get more “time” for relationships etc. or am I doing it because I am lazy?

    Am I hiring financial salesperson to avoid educating myself financially and thus make my own financial decisions?

    Am I hiring cleaning service/gardner to avoid getting some good exercise ?

  21. Tyler D
    Tyler D says:

    I've been to the US once, so I know the bus thing does not work there – but could it be applied to car pools? Or would it be considered too rude to sleep in someone else's car?

    Prashant: one of the most innovative companies in the US has been doing something like this with buses.

    (NY Times article) http://preview.tinyurl.com/33opbz

  22. Eric
    Eric says:

    I agree that when one has their major expenses paid down, in hindsight, it does make sense to buy time with money. But right now, I’m relatively young with a mortgage and daycare costs. My wife and I talk about going on a date, but that date would cost quite a bit:
    $48 babysitter (~$12/hr)
    $20 movie tickets
    $30 dinner

    As you can see just the babysitter costs as much as going out (kind of like how our daycare costs just as much as our mortgage). On one hand, I can see how scrimping is a good thing. It’s like sucking it up and studying hard in college since your GPA will open a lot of doors, whether it be for grad school or employment (I didn’t get good grades, so I know first-hand). On the otherhand, I also argue with my wife that if we don’t enjoy life a little now, there may be no relationship to enjoy when it comes to retirement.

    Thanks for listening,
    Eric

  23. Sebastian
    Sebastian says:

    Wow, what a great post! Even if you only get through money and stuff which we are wasting our time with while there are much more things (think of anger or envy), you really got a point there. I’m actually writing on an post about time myself and maybe one or two thoughts of yours will appear in my post as well.

    What I really miss is the point where it comes to the money you need to survive. In fact, if you earn hardly enough to survive, you don’t have the chance to decide earning less money and spending the time on important things like love. You must push yourself through the whole life, never enough to life nor to little to die. I sadly could not get a solution for this problem yet. Maybe I’ll come up with one on my blog.

  24. Adam
    Adam says:

    I used to devote myself in meditation for a whole straight year living off the charity of a monastery. The material life was poor, but I was extremely happy, peaceful and contented. Now back in the US, I work a lot of hours and make good money, but gradually life has become miserable.

    It’s the matter of balance. Thank you for this topic. How smart! You have waken me up!

  25. Brady Bagwan
    Brady Bagwan says:

    The digital age that we live in has many advantages but has some downsides as well. Time is becoming more precious for professionals since technology prevents you from getting away. Setting boundaries is essential to preventing burn-out. Delegation is the other part of the equation. For those that don't have a staff, who do you delegate to? One way to overcome this is to use a personal assistant service. I just started a company called Delegate Source based in Denver. While there are quite a few concierge services out there, there are very few who approach lifestyle and household management broadly. It really is simple math. If a professional’s hourly cost is more than the cost of outsourcing personal services, why not achieve a better work/life balance by delegating errands and tasks?

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