Time and Money Management: Balancing Life’s Most Valuable Assets

“Many people take no care of their money till they come nearly to the end of it, and others do just the same with their time.”

Johann Wolfgang von Goethe

It seems like many of us struggle to manage our time and money effectively. Some people always feel short on cash, while others never have enough time for the people and things that matter most.

If we learned the essential skills to optimize our finances and time, we could avoid these common pitfalls. Let’s explore the differences between time and money, and how to invest both resources wisely.

Time vs. Money

It’s often said that “time is money,” but this isn’t entirely accurate. While it’s true that we can trade one for the other to some degree, they aren’t interchangeable resources.

Time is a finite resource. We each have a limited amount of time, and we can only create more of it through means like improving our health and longevity through measures like weight management and fitness.

Money, on the other hand, is an infinite resource – we can always find ways to earn, save, and grow our assets it over time.

Balancing Time and Money

Without a balance of time and money, we can’t fully experience all that life has to offer. Someone who makes a high income but works 80 hours a week may have financial security but poor quality of life. Conversely, someone with abundant free time but no assets may struggle to meet their basic needs.

To live our best lives, we need to learn how to manage and invest both time and money wisely. Neither can fully replace the other.

Wasting Time for Money

There are countless ways that peers, bosses, influencers, and even parents advise us to earn or save a few extra dollars. But sometimes it’s not money we want more of; it’s time!

Some glorify working long hours and sacrificing our own needs to dedicate ourselves to a career. But destroying your health shouldn’t be the requisite to earning a badge of honor.

When we become too stressed to care for ourselves, we diminish our ability to care for important people, such as ailing parents or our families. Do you want others to know you simply as a hard worker or would you rather be remembered as a wonderful parent or mentor?

Instead of promoting burnout, we should prioritize habits that support our physical and mental health. For example, studies show that sleep deprivation can lead to depression ^[1], the second leading cause of death of individuals between the ages of 10-34. Investing in ourselves, through adequate rest, self-care, and work-life balance are also important habits for long-term success.

Wasting Money for Time

In addition to getting more money, we often try to pay for convenience to save ourselves some time in our busy lives.

While we think we’re saving time with convenience foods – which are more expensive than homemade meals – we end up hurting both our wallets and our health. Most convenience foods are more costly than high in fat, sodium, and sugar intake, which can lead to weight gain and increase risk of early death ^[2]. So much for saving time!

Instead of fast food, learn to meal prep a week’s worth of food at once to save time and money. You can buy necessities in bulk from a wholesale club to save your money, but be sure to compare the prices to your local shops as well.

Wasting Money and Time

To make matters worse, we often end up wasting both money AND time. Some of the most common offenders include our addictions.

For example, smoking and drinking not only cost a lot, but they wreak havoc on our health, especially when done in excess. This can lead to health conditions that we pay for in increased healthcare costs and decreased lifespans.

Even minor addictions such as coffee decrease our productive time. You can enjoy coffee in moderation for productivity boosts when you actually need it, but daily coffee drinking can lead to caffeine tolerance, withdrawal, and hinder productivity^[3].

The Time Test

With all the ways we waste money and time, it’s hard to keep track of what’s worth investing in. The first test involves the opportunity cost of time.

When you start thinking of the price tag in terms of how many hours of work it takes to make that much, you make better decisions.

For example, a colleague of mine once pointed out an alarming trend among his friends. The high-earners refused to purchase a costly winter coat brand selling for over $1,000, but the ones barely scraping by were scrambling to snatch one up. At wages of $15 an hour, it would take over 70 hours (after taxes) to pay it off.

If you’re just buying this coat to be trendy, your $1,000 purchase will last about 2 years before it goes out of style and you have to get a new one. Instead, get something at 1/10 the cost and use it for 10 years before it becomes unusable.

Never buy something just so you can show off. Successful people don’t spend beyond their means, and they certainly don’t buy things to show off their newfound wealth. Doing so may have the opposite effect, turning newly made millionaires broke^[4] and even putting a target on themselves for criminals.

The Money Test

On the opposite end of the spectrum, we sometimes find ourselves going extremely out of our way to save as much money as possible. However, this leads to the exact opposite problem, where we waste all our time trying to score the best deals that we could have put that time to better use.

In this case, we may end up traveling over an hour each way to get something on sale, but the time and cost of traveling may actually negate our intended savings entirely. To evaluate whether we’re really getting a good deal, consider how much money we saved (after considering the cost to travel) and how much more time it took to generate those savings. If your job pays more than that per hour after taxes, it probably means you wasted your time.

Remember that not only does your money take time to earn, but that your time is also worth money. Don’t waste your time trying to penny pinch on everything because unless you’re using the commute time productively, you’ll often be unproductive doing so.

The Cost-Benefit Analysis

A full cost-benefit analysis is a bit more complex, but can be helpful when evaluating whether a decision will save ultimately help us save time and money.

For example, someone who cooks daily instead of eating out may have to put in a little extra work, but there are many benefits. If this person becomes quite proficient in cooking, they may end up turning it into a business one day. But even discounting the hypothetical situations, they will firstly save a lot of money if they budget for their meals properly. Second, they can eat healthier and improve their health, lifespans, and quality of life. Third, they may also save time because sometimes driving to a restaurant, waiting for a table, and waiting for someone else to cook can instead be used to prepare a week’s worth of meals in bulk.

Based on this person’s situation, the benefits of cooking, which include improving quality of life and having more time/money, seem to outweigh the costs no matter how you look at it..

Keep in mind that the benefits don’t have to be practical. If something brings joy to your life, then the time and cost of doing it is NOT wasted. If you go out to eat with your family once a week as a treat, everyone enjoys their time, and the meal is within your budget, then you are entitled to do so.

Just keep in mind that when you spending your time and money into something, you are often giving up something else for it.

Maintain Your Time and Money Mindset

Even with the time test, money test, and cost-benefit analysis at your disposal, it can still be challenging to remain consistent in your time and money management efforts.

To stay motivated, it may help to shift your mindset. Instead of focusing on what you’re giving up, think about the positive outcomes you’ll gain by following through on your goals. For example, consider how skipping those costly brunch outings and investing that money could allow you to enjoy more frequent vacations or other meaningful experiences.

Mastering the balance of time and money is no easy feat, but developing healthy habits can significantly improve your quality of life. By diligently applying the evaluation frameworks we’ve discussed you can have confidence that you’re making wise choices with your most valuable resources. Staying focused on the long-term benefits, rather than short-term sacrifices, can help you maintain motivation and consistency to better your time and money management skills.