Time Of Your Life Economics notwithstanding, does it really pay to put a dollar value on your time?
By Penolope Wang

(MONEY Magazine) – Everybody knows that time is money, but until recently no one had put a number on just what our time is worth.

Now Ian Walker, an economist at the University of Warwick in England, has devised a method for calculating the exact value of a person's time. I'll spare you the econometric formula; suffice it to say that, using salary, taxation and cost-of-living data, Walker determined that an hour of a person's time is, on average, worth 6.16[pounds] (about $9 U.S.) for British men and 4.87[pounds] (about $7) for British women. This information, Walker says, can help people decide whether it's cost-effective to pay for timesaving services, such as buying takeout meals rather than cooking or hiring a housekeeper to do your vacuuming. The study didn't run the numbers for Americans, but the same principle applies: If you could pay someone to perform your tasks for less than your time is worth, then--theoretically--you oughta hire them.

The operative word, however, is theoretically. The problem with equating time and money, as Walker admits, is that no simple formula can address all the complexities of daily life. For example, the calculations assume that all hours are equally productive. But no one--except maybe Britney Spears or Bill Gates--pulls in dollars 24/7. For most of us, the bliss of having extra time is being able to use it for things other than work. If you hadn't devoted an hour to laundry last night, would you really have polished that sales presentation? Or might you have watched The Sopranos instead?

Walker's formula also fails to account for what might be called the time value of time. As we age, we have less time ahead--and the time we do have becomes, as the ads say, priceless. If we were to place dollar figures on this shrinking asset, we wouldn't be able to justify working, since there'd be no way to earn back the value of our time.

In the end, perhaps it's better not to waste time thinking about the time we waste or the cost-effectiveness of our choices. The parking fee at my favorite beach is $10 a day. I say it's worth it. --Penelope Wang