How Much Are You Worth?

How much money have you spent today, and how much have you made?

I’m not talking about actual dollars that left your wallet or swipe machines that added to your credit card balance or deducted from your bank account. I’m wondering how often you consider just how much a day costs you. A few minutes of calculation can be a real eye opening experience for most people, and just might help you realign your priorities. Do you have a few minutes?

Try this for me. I know this is really simplistic and I can certainly complicate it up for you if you really want me to, but I just want you to think about something very basic. Get your bank statement from last month and just look for the total withdrawal figure for the month. Hopefully your bank statement filters most of your expenses – house, car, utilities, extras, food, cash withdrawals, money sent to credit cards, daycare, gas, etc.

Now calculate what you’re bringing in. Take your last paycheck (and that of anyone else in your household, if there is more than one wage earner) and annualize it. If you get paid twice a month, multiply it by 24. If you get paid every two weeks, multiply it by 26. Don’t just say, “I make $25,000/year” because that doesn’t consider all of the taxes and other deductions that come out of your check.

Now take that annualized figure and divide it by 12. Next, divide your income figure by however many hours you typically work a month. If you’re working 40 hours a week, 8 hours a day, then use 320 hours per person – that’s a 20 day month, which is about right.

What you have now is an estimate of what your actual hourly wage is.

Do the same with your bank statement total – divide what you spent last month by the number of hours you work for pay in a typical month.

That’s how much you spend per hour of work.

Let’s say that after you do this exercise, you find that your actual pay per hour of work is $10/hour, and your actual expenditures per hour of work are $9/hour. In an 8 hour day, you bring in $80 and spend $72.

Does looking at it that way impact whether or not you decide to run over to Starbucks for a latte to get you through the afternoon – is it worth 30 minutes of your work time to pay for a cup of sugar and milk?

Does it make you think twice about whether or not you’re really too tired to boil up a pot of pasta & sauce and throw together a salad with the ingredients in your house vs. running through the drive through for a $20 KFC family meal – two HOURS of work investment for one meal?

Would it make you wonder whether or not you need fourteen gazillion cable channels full of nothin’ when you’re only there and awake and watching maybe 1-2 hours a day? Or perhaps whether the thermostat couldn’t be adjusted a degree or two to cut down the electric bill, or if maybe you could see if the library has that book you want instead of buying it?

How much do you truly make an hour, and how many hours of your life is the STUFF that you pay for worth to you?

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