Friday
How much is your time worth ?
Here's how to think about whether you should pay for any service that may make life easier.
Ian Walker of the University of Warwick in England came up with a formula a few years ago to help assess the monetary value of your time. He takes into account your gross hourly wage, your marginal tax rate (the top tax rate you pay), and the cost-of-living in your area.
The formula is based on the assumption that what you make is an indication of how you value an hour of your time because that's what you're willing to sell it for to an employer. Theoretically (although not practically), you could always be working and earning money instead of cooking, mowing the lawn, doing the laundry, etc.
But the worth of your wage also depends on the cost of living in your area and your taxes, since they determine how far your wage will go when it comes to spending it.
Here's Walker's formula (algebra-phobes may want to close their eyes now):
The value of your time = [Wage(100-Tax rate)]/Cost of living.
more..
Ian Walker of the University of Warwick in England came up with a formula a few years ago to help assess the monetary value of your time. He takes into account your gross hourly wage, your marginal tax rate (the top tax rate you pay), and the cost-of-living in your area.
The formula is based on the assumption that what you make is an indication of how you value an hour of your time because that's what you're willing to sell it for to an employer. Theoretically (although not practically), you could always be working and earning money instead of cooking, mowing the lawn, doing the laundry, etc.
But the worth of your wage also depends on the cost of living in your area and your taxes, since they determine how far your wage will go when it comes to spending it.
Here's Walker's formula (algebra-phobes may want to close their eyes now):
The value of your time = [Wage(100-Tax rate)]/Cost of living.
more..
Comments:
Post a Comment
