Contrary to what people think, free time does not exist. You pay for it all the time of your life. We are either using time purposefully or wasting it. How does this affect our business? It is the value of our time that makes the achievements we want. It’s time to stop overlooking what our time is actually worth and step into increasing its value. Only then will we be able to create better decisions. Discover an exercise to learn the value of time. You’ll find that in the next twelve months, you will be able to stay on track and bring intention into everything you do.
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The Value Of Your Time: What Your Time Is Actually Worth
Unless you master your time, you can never truly be master of your destiny. What is an hour of your time worth? I don’t mean to get all philosophical on you, but have you thought about your time is your life? If you think about it, time is all you have. Moreover, there’s no such thing as free time. You can’t save free time and use it later. You have leisure time but it’s not free time. You’re either using your time purposefully or wasting it. Leisure time is the time that you use for rest and recreation. You have chosen to spend your time this way. It is not by default. What does this mean for your business and your life? Unless you commit to continually increase the value of your time, you will not be making the money or business you want or working the number of hours you want. There is no free time. You pay for all your time in your life. If you don’t use it, you lose it and it affects your income level, your health and your relationships. If you don’t value your time, no one else will. It always intrigues me that people generally have no idea what their time is worth and how to increase its value.Unless you master your time, you can never truly become the master of your destiny. Click To Tweet
The question is, what is your time worth? Do you know what time is worth? Do you know how to value your time to achieve your income growth? Unless you know the value of your time, your capacity to make effective decisions on what you should do or shouldn’t do, and whether you should delegate would be fatally flawed. Another thing to know is this exercise will also challenge your perception around the value of time. If you’re honest and I hope you will be, you will get tremendous clarity about why you may or may not be making the progress you want. You and I both know it’s easy to fall into the trap of everyday life.
This exercise will ensure that in the next twelve months you’ll stay on track. Be sure to bring intention into everything you do. If you are the type of person who has been living a compulsive life where you’ve been very focused on achieving in one or two areas of your life at the expense of others, then this exercise will channel your ambition. It will ensure that you win at work and succeed at life and don’t burn out. I want to give you more of the building blocks and start with this one simple exercise. It’s going to open your eyes to what’s going on with your time, the good, the bad and the ugly. No more going into default mode and hoping that in time success will come to you. Now, we’re getting intentional. We are taking the first step towards designing the life the way you want it. We’ve all heard that time is money. The problem is, we don’t act like that is true, but what if we did? What is time and exercise doing for you?
Here is the reality. You have some big decisions about what you’re going to do with your time. Maybe there are some enticing opportunities on the horizon that you shouldn’t take. Maybe you have a project or business you need to exit to make room for something even better. The only way you’ll know is if you determine the real value of your available time. The best way to do that is to work from how much revenue you’re currently earning. Notice the four big blocks, time off, time on administration, service delivery and revenue generation. We only have 365 days in a year, 366 if it’s a Leap Year. How we divide these days is critical for understanding how much they’re worth.
Take the total amount of revenue you are projecting and divide it by the number of days you have available to earn it. You want to subtract the number of days you’re taking off, this is your extra time available. Your current value of time is the total income divided by the total number of days. That’s your dollar value per day, eight-hour a day formula. This will tell you what you’re making. The next best way to do that is to work from how much revenue you’re going to be earning. The current value of time equals total projected income over the total number of days, dollar value per day, eight-hour day formula. If you’re an entrepreneur, a business owner or a CEO, this exercise is for you. Practice working on profit building for an hour. At first, it won’t be easy.
Eventually, you’ll be able to go the distance on an hour, on profit building activities. This is what productive time is all about. Productive time is time directly generated to produce income. What percentage of all time are you productive? The above exercise shows you your dollar value. However, what we really get to use, how much of your actual days are productive? I’m taking off 99 days each year. Subtract those days from 365 and those are the days that I have left for work. For me, that’s 265. For you, it will be whatever is left after you factored your time off. I take what is left over and break this up in three different ways. I sit down and track for three days how I spent my working time. Everything I did, I kept track of. I looked at the time I spent on administration, service delivery and revenue generation.
Administration refers to the maintenance staff, running meetings, answering emails, returning calls and so on, the time I’m working on the business. You want to look at it this way. You have things to do to maintain your business and you have things to do to grow your business. Here’s a pro tip. The more you can group these activities into their own days, the more focused on efficiency you will pick up. Service delivery is if I’m doing medical-related activities or I’m teaching a program and there is no selling involved. Revenue generation for me is stuff creating video courses, blogging, writing books, conducting seminars and selling to clients. For you, it could be the different business in your portfolio; the different customers or clients that your accounts will serve. It could be creating a product, making sales calls and whatever turns the crank in your business.You’re either using your time purposefully or wasting it. Click To Tweet
Once you’ve figured out how many days you have to generate revenue, these are your revenue generation days. The worksheets will divide your total revenue target and see how much those days are really worth. Every day you are working just to maintain the business and not create revenue, you’re potentially wasting time. I encourage you to think about doing this exercise over the next few days. I was shocked to realize I was only spending 50% of the time on revenue generation activities. I decided to change how I spend this time. I started passing on more of the administration and service delivery to others and focus more on revenue generation. You’ll notice the first critical piece of information. How much money are you projecting to make in this coming year? We want to put a dollar sign in our days so we can see how much our time is worth. You’ll be surprised.
Doing this exercise gets very sobering very fast, but it’s also empowering. When I first did this exercise, I found our spending time on activities that were not generating revenue. It took me a while to make the decision but eventually, I decided to reconfigure how I ran some of my businesses. What are your results telling you? Whatever the results, whatever the answer, doesn’t it feel good knowing where you should spend your time? Clarity is a wonderful thing, even if it’s tough news at first.
The first time I went through this exercise, I was shocked. It explained a lot about my financial situation. Immediately I could see my work was creeping into my weekends and into my nights. From that, it was easy to see how I was compromising the time I had for the important things in my life. Productive time is time generated and directly related to your income. What percentage of the time are you productive? One study of Fortune 500 CEOs estimated they had 28 productive minutes a day. Another estimated it at 38 productive minutes a day. Can you do any better? Shocking isn’t it that they spend 28 to 38 minutes only on profit-building activities a day. Think about what a CEO does. However, most of us are not working at that level so we can afford to be a lot more productive.If you don't value your time, no one else will. Click To Tweet
The differences between the compulsive life and the designed life, in the compulsive life, there are many things I do well. In the designed life, there’s only one thing I’m brilliant at. In the compulsive life, I will go after every opportunity. In the designed life, I will only focus on my core priority and work at my core competence. In the compulsive life, there are many things I can use to increase the bottom line. In the designed life, there is only one priority. I need to focus on the impact, the bottom line right now.
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