We don’t buy things with money, we buy them with hours from our life.
Or, as Henry David Thoreau put it, “The price of anything is the amount of life you exchange for it.”
This is a life-changing principle. When we begin to see our purchases through the lens of exchanging life, rather than dollar bills, we can better appreciate the weight of our purchases and understand their full cost.
For that reason, I thought it might be helpful to take a hard look at how much life some of our purchases actually cost us.
For the sake of conversation, let’s use the median US household income. In 2017, that number was $61,400. For simplicity sake, let’s round down to $60,000 annual income.
If your household income is $60,000, working a typical 40-hour workweek, here is how many hours of work are needed for the following purchases:
Grande Starbucks Cappuccino ($4.00) = 8 minutes of work
Pair of Wrangler Jeans ($24.99) = 50 minutes of work
Coach Brand Purse ($119.99) = 1/2 day of work
55″ FlatScreen TV ($711.00) = 3 days of work
256GB iPhone XS ($1,249) = 1 week + 2 hours of work
Dinner at a restaurant for your family of four ($80.00) = 1/3 day of work
Dinner at home for your family of four ($17.00) = 1/2 hour of work
New Living Room Furniture Set ($1,983.94) = 1 week + 3.5 days of work
2019 Ford Fusion SE Hybrid ($26,550) = 5 months + 10 days of work
2,500 square foot house (10% down payment, 30-year mortgage of monthly payments, $303,000 purchase price) = 11 years + 6 months of work
1,600 square foot house (15% down payment, 30-year mortgage of monthly payments, $196,000 purchase price) = 7 years + 2 months
Keep in mind, the amount of work needed for the items above is based on an annual salary of $60,000. If your annual salary is $30,000, the work time will be doubled. If you make $120,000/year, the measurements should be halved.
Of course, there are alternatives to exchanging our hours and lives for material possessions…
It takes just 10 minutes to tell your child a bedtime story.
45 minutes for an evening walk with your spouse.
60 minutes to help your son/daughter with homework.
Or 2 hours/month to volunteer at your local soup kitchen.
The money we earn is ours to keep and we can spend it as we wish. But it can be a helpful exercise to realize how many hours of our lives go into each purchase we make.
And it is always wise to remember we can spend our hours pursuing items of far greater value than material possessions.
ItsCrochetNotKnit says
I have done this before–for example, I know I need to work three hours for a full tank of gas. Not sure where you’re living, but half of my paycheck is taken out in taxes, retirement, and insurance. Those figures you gave need to be multiplied by 4 in my case.
Jessica says
I agree. The calculation of how much it costs in hours needs to be
Income
Minus set expenses like annual housing, electricity etc
THEN that number is what the author should use to figure out hourly cost.
Median house price in my city is over $1M for a year down shack, then cost of electricity, etc on top.
B Hansen says
Very true. But not everyone belongs in this “we”. There are also those who buy stuff with the life time of others.
Who?
Those who make money of our labour, that’s who.
Jaya says
I like this perspective. It came to me as I continued the multi-year process of decluttering my parents’ house (ongoing process with a sibling who’s a great declutterer). We have opted to donate as much as possible, in part because the number of hours it would take to sell the sellable stuff brings the net gain of these sales way down (in some cases below $0) and in part because there are organizations in our area that can accept and reuse a lot of the stuff. As a formerly self-employed person, I think the idea of how much something is worth in hours worked can streamline a decision-making process and give us a way to assess value.
hannah says
I’ve always had this approach. At 13 i got my first job paying $3.15 per hour (in New Zealand). At that time you could only buy branded jeans in my town, which cost $110, so basically 3 Saturday’s of working from 3 to 11pm to buy a single pair of jeans. (These days my teenage nieces earn the minimum wage of about $16 and can buy a pair of jeans for $20 – and they think they are hard done by!).
As a result i’ve always been careful with money, because it was so hard earned in those days. I’ve had to do the opposite and learn to spend on things i actually need!
I went became self employed at 30, sick of working for a salary doing something i didn’t like for 30-50 hours per week. Since then (15years), I’ve done something i still don’t like much but for only about 20 hours per week (and some years I have 6 months off) and at 3 x the hourly rate. Bought my house without a mortgage ($500k in NZ for a basic house). Never feel like i’ve gone without. I think it all goes back to that first job and learning the value of money…
Jon Murphy says
Good stuff. In economics, we call this “opportunity costs” as is primarily how we model how people make decisions.
Deb says
In Business Management when I was in college, I called this “Financial Euphoria”, I reàd a good book on it. It will always be perceived differently because of the Euphoric state it will always be in our lives or society.
Tracy says
Those numbers are highly indulgent. My wage is significantly less than $30,000. Couple that with zero wages for 11 months this last year being out with an illness. And yet I’m still not behind on my bills. Your ideas are cute. I’ll bet most people dont have the discipline to live a minimalistic lidestyle. BTW, my car isn’t working right so I started taking public transportation when I went back to work. I’m still part time but doing ok because it takes sasrifices. The reward is freedom.
Sara says
How are you feeding a family of four for $17? Pasta and tomato sauce?
joshua becker says
Here are 98 ideas for under $5.
Josephine malatesta says
You can with $ 10
if you cook and be smart when you shop
jo mama says
you did not even include 30% taxes. so increase all those times by another 30%
Ion Buton says
Our culture has become stagnant…Our society has become separate of reality for those living within the denomination of currency.
…A separation of humanity created by the money driven caste system as a byproduct of world governments inability to actually do anything that helps people out of the stagnation or cruelty put onto them by the free market society,
…a system that uses freewill to its advantage to create disadvantages for those that come to the future generations.
Jackie says
Whenever I read articles like this, reminds me of a movie, if you haven’t seen it, that is dystopian yes, but makes you think. It’s called “In Time.” What if you were paid in hours, not money? I know it’s a little far fetched, but always makes me think of how really money buys us the things we use or do in life, and we have so many life hours to use them….. As I said, it is a movie, but I thought it was quite thought provoking…..PS. I read “Your money or your Life” many many years ago and it shocked me into what the value of things really are. It’s sad so many of us go through the “gotta have stuff” to only realize it was such a waste and we end up just giving it away and think of the hours really wasted on “stuff.” Oh yes, and everyone should watch the George Carlin clip on “stuff.” Google it…..It’s thought provoking too!!
Joan Birt says
Totally agree! I read ” Your Money , Your Life” years ago and it changed how I view my purhases.