How Much is your Time Worth? When Outsourcing your Life Makes Sense Financially

Ever sat there spending 3 hours cleaning your house or apartment on a beautiful sunny weekend day because you simply didn’t have any other time to do it? Or maybe you spent two hours mowing the lawn, felt tired the rest of the day, and went to bed that night wondering where your time had gone.




We’ve all been there at one time or another. So why do we keep doing it? Well, this site majors in personal finance and minors in frugality, so it is a rhetorical question. However, at this point in my life I have never paid someone else to do this kind of work. And I’m starting to wonder why.

Paying the Specialists

opportunity cost outsource your lifeSure, I’ve paid the ‘pros’ in the past. I don’t know a thing about plumbing, electrical work, installing a drainage pipe, or fixing my furnace. And from a time value and even strictly financial standpoint, it’s really not in my best interests to learn all of the ins and outs of these professions, where skilled laborers have spent years learning and perfecting their craft. If I somehow screw up the job, I’d be out 2, 4, or 10 times what I paid for someone else to do it! On a side note – here are some tips for hiring a contractor, if you need one.

If you run a business, it is probably to your benefit to have an accountant, lawyer, and tax pro on your side versus learning the ins and outs of each.

It almost always makes sense to outsource these kinds of jobs, and we seldom think twice about it. But I’m talking about something different.

Paying for the Stuff you Hate

I’m talking about the stuff that all of us can do (that is usually very time consuming), that very few of us really want to do – cleaning the house, mowing the lawn, doing the laundry, shoveling the driveway, and even cooking for many of us.

In a post that I wrote recently, I highlighted a list of 55 self-employment opportunities, or ‘marketable hobbies’, as I phrased them. The impetus of that piece was to highlight the infinite world of opportunity to do things that you are good at and enjoy doing and have others (who are not good at or don’t enjoy doing them) pay you for it. This discussion is shining light on the other end of that scenario.




A Logical Way of Looking at Whether or Not to Pay for Help

The conclusion that I am coming to on this topic is that you should only pay others to do your dirty work for you if the opportunity cost of doing it yourself is higher than what you would pay to have it done. In other words, just because I hate cleaning the house and I have disposable income does not mean that I should pay others to do it for me. Let me explain further.

A Look at Opportunity Cost with ‘Susie, the Logo Designer’

value of your timeLet’s give a very real life example of when it might make perfect sense to outsource some work.

Let’s say that ‘Susie’ has become quite an expert at designing logos for businesses as income on the side. Each logo that Susie designs takes her about 4 hours to complete and she make $200 from it (or about $50 an hour). And She loves doing it! In fact, Susie has become so good at it, that she’s having to turn down referred clients because she simply doesn’t have the free time to work with them all.

At the same time, it takes Susie four hours to clean her home each week. And she hates it! Susie is considering hiring a housemaid to help her with the chore. The going rate for housemaids in her area is $25 per hour. Does it make sense for Susie to hire one?




Absolutely! But… she should be designing logos during that free time. In fact, I’d argue that if Susie were to work those hours doing the work that she enjoys, it would make perfect sense from a quality of life and personal finance perspective for her to pay up to $50 an hour for a housemaid. Or maybe she could work just two hours, break even, and use the other two hours to take her dog for a long walk. The bottom line is that Susie would be trading the act of doing the chore that she hates for the work that she loves. Why wouldn’t you make that trade?

The Dangerous Trap that Comes with Outsourcing your Life

Where ‘outsourcing your life’ gets dangerous is when you begin to justify paying someone else to do your dirty work so that you can just kick back and relax. That is dangerously irresponsible personal finance, in my opinion, unless you have met all of your financial goals in life already. It’s very tempting to say ‘I’ve earned it, I should just kick back and relax for the day’. It would be very easy to justify why you have earned the right to relax. And maybe you have ‘earned it’ in some cases. But be cognizant of getting caught in that trap.

Final Thoughts

The takeaway that I’d like to get across, because you really don’t hear it often from a personal finance blog, is that if your time has a measurable monetary value on it and it might actually be a very wise decision from a financial, quality of life, and business angle to pay others to free that time up. And you shouldn’t feel guilty about it. In fact, you should pat yourself on the back. Just don’t pat too hard.

Outsourcing Discussion:

  • What do you pay others to do that you can do yourself?
  • Have you ever looked at the opportunity cost and value of your time in this way?

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