As a professional poker player, I enjoy the process of optimization—figuring out how to do things as effectively and efficiently as possible.
Outside of a poker context, optimizing isn’t about getting max value or pushing my hourly rate to an all-time high. It’s all about time, and more specifically, the preservation of it.
I find myself striving for optimization in most aspects of my life, but undoubtedly, the area I’m most passionate about is time. It’s the scarcest commodity in the known universe, the only thing we cannot get more of under any circumstances.
Consciously improving how we spend it is one of the most important habits we can form. Saving time is the only way to get more time
Here’s a simple strategy to help you better optimize how you spend yours.
100x Your Hourly Rate
Money is our most prominent way of packaging time, making it tradable with others.
This is why we use the term spend’ when referring to how we allocate it.
Because money is our best attempt at assigning value to time, the most efficient way to increase your hourly rate is to spend your time on more productive tasks.
One exercise to help you achieve this is to assign a value (measured in hours) to each task that you do. The principle is this: “What gets measured, gets managed.”* Any estimate is better than none.
Some tasks will be worth more than you’re currently being paid. This is logical—completing these tasks is part of the process of building toward a higher hourly rate and has the potential to increase your rate in the long run.
For example, one of the most valuable ways you can spend your time is getting clarity on your vision (for yourself, or for your company), and effectively communicating that vision to the world. This will attract the right people into your life. Because relationships are the source of all forms of prosperity, any task which optimizes this process is extremely productive.
Let’s approximate this as a $1,000/hour task.
Producing content may also be worth more than your current hourly because it can increase your future hourly by attracting higher-paying clients or customers. Perhaps this is a $500/hour task.
Next, you have your current hourly rate doing whatever it is that you do. For example, earning $100 as a coach or consultant.
Many activities will be below your hourly and therefore, time spent doing these will provide far less utility than it could elsewhere. This is how opportunity cost comes into play. Grocery shopping, for example, is roughly a $10-$15 per hour task because it can be outsourced for approximately that amount. When you replace an hour of errands with working on your vision, you could be increasing your hourly from $10 to $1,000, a 100x multiple. It all depends on where your hourly maxes out (for now).
If you apply this macro approach to your life and business, spending as much time as you can to practically allocate time toward activities that are above your currently hourly rate, it will continue to increase and compound.
A Last Word on Productivity
There are two disclaimers to the above theory.
First, not all of your time can (or should) be productive. If you’re not trading unproductive time for productive time, the above principle will not apply. That said, since rest and leisure are necessary in order to be productive, outsourcing a task merely to rest has merit, too.
A more accurate way to measure the value of your time is to divide the number of hours you work by the number of hours in the day. For example, if you work 8 hours each day at $100 per hour, you earn $800 per day. Broken down throughout all hours of the entire day, that’s $800/24, which equals $33.33.
This is what I call your ‘resting hourly’ (RA). Once you have this number, it stands to reason that when reasonable and possible, you should outsource any task you do not enjoy which falls below your RA.
Second, not all of life is about maximizing one’s hourly. As alluded to above, insofar that you enjoy a given task, you should spend as much time on it as you can or please. Not everything needs to be optimized, and not everything can be. The goal is to optimize all the things you should to maximize the amount of time you can devote to all the other things that matter. After all, no tech genius is coming to our rescue anytime soon over our inability to purchase more time. Use it wisely.
I wrote more in depth about outsourcing tasks using Upwork. Read it here.
A question for you: How do you outsource your time on a consistent basis? What does it free you up to do instead that’s more valuable to you?
Let me know in the comments.
- Paraphrasing my takeaways from a lecture entitled “Electrical Units of Measurement” by William Thomson, the Scottish physicist also known as Lord Kelvin.