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.
David says
You should re-do your calculations so that they reflect post-tax dollars. If your household income is $60K, you likely only bring home $45K. If your household income is $120K, you likely only bring home $90K. The actual number of hours that you are trading for the possessions that you choose to own is much worse than you are already estimating.
joshua becker says
Except that your tax dollars are a legitimate expense that result in many of the things you use each day. It would just be another item on the list (Taxes: $xx = __ days of work), not something to separate out before doing the computations.
Praveen Kumar says
Imagine if all of us started doing it.. Life would become more meaningful if not for all but for many of us.
Matthew Rideout says
Next, add in the time you spend shopping / researching for that purchase. It gets more expensive again.
Brenda says
To add to the analysis, some purchases are just an initial outlay with a mortgage on future time and financial resources. Though I love sailing, it is important to realize sailboats need significant loving care requiring time and money as well as the time and money needed to enjoy using the sailboat. Though most love the experiences gained from their investment, marinas are full of ignored and decaying vessels who owners didn’t consider the after purchase commitment of time and money. Many other types of “toys” and hobbies have a similar future time and money commitment.
Point being – consider not only the cost to purchase, but future costs and the hours you’ll need to work in the future to maintain the purchase.
Matthew Thomas says
This of course gets even more expensive when you consider that out of that $60,000 per year you have to pay taxes and then you need to apply the ‘so called “cost of doing business”‘ items like clothing for work, transport to and from work, medical, etc that without, you simply would not see the income…..
Kelly says
Encouraging proper perspective
Very well stated
Love this article! Sharing
Nanci Casson says
The FIRE movement (Financial Independence Retire Early) is based on. Leave below your means, invest and live the life you are passionate about.
Frank satar says
Great article. Thank you!
Avery says
This is why investing is important. The premise here is only true if you only earn money by working. Reducing what you spend and saving more let’s your money work for you instead of the other way around.
Spock says
You’re not getting the point of the article. What we do when we have the capabilities of technology and technical abundance is a waste of human time.
The main takeaway is that we should aspire to become a Star Trek Society.
Khaled says
No, that’s only how you buy things with other people’s time… in a capitalist corporate system.
Tni LeBlanc says
Excellent article.
Add interest paid on the loan and calculate taxes paid too.
Noleei says
I was going to add that interest on a Homeland adds up to way more than the price of the house especially in a 30 year repayment plan. It’s like twice the amount.
Alan Rupnick says
This realization is the reason I gave up all my earthly possessions and began so seek out adventure, travel and spending more time with the people in my life who are important to me. The material world is of no value to me and it’s true what they say, you can’t take it with you.
Joe G. says
Exactly.
Leone says
So, how do you survive day to day? If you do not have anything but time to spend with friends….do you expect friends and family to support YOUR lifestyle?
Nanci Casson says
If you follow the FIRE movement, you would live by the Trinity Study which states that if you save 25x your annual expenses invested in an index fund or comparable investment and use a 4% withdrawal rate, theoretically you will never run out of money.
It’s what the FIRE movement is based on a lot of people are using it to quit corporate america and living a life they are passionate about.
Turns out, your ability to quit working is based on your savings rate. The more you are able to save, the sooner you can quite working. If you were able to save 50% of your income, you could quit working in 17.5 years. If you were able to save 75% of your income, you could quit working in 7.5 years.
Most people who do this become debt free first (many pay off mortgages as well), live frugally and pick up a side hustle. That is how they are able to save 50% of their income.
It’s not easy but it’s well worth it. I followed the FIRE movement and I am now semi retire with 3 rental properties. I quit my 93k a year job and now only work 3-6 months a year. Between rental income, consulting income and investment income, there is no need for me to work in corporate america any longer and quit almost 15 years before my planned retirement date in my 60s. And to think there are people doing what I am doing in their 30s.
It can be done, just research the FIRE movement.
Gordon Lehnert says
You say you can’t take it with you but the reality is that you can’t live without it. I don’t know your background but say if your father turned you out at 18. No financial help of any kind. What would you do? How would you make it in the world with just a HS diploma or even less. Tell me how you would do it.
Jessica S says
These prices must be coming from lower cost areas of the country. Here in California you could get a shack for $300,000 and to feed 4 people for $80 you’re not going anywhere nicer than denny’s…and you probably didn’t tip your server.
That being said, I always enjoy making the most of my time, buying high quality and long lasting products. Or buying tools to help me do more things for myself.
Krista says
That’s what I was thinking when I read it too – dinner out for my family of 4 in california is a minimum of 80 with tax and tip.
John Killinger says
Those additional costs are due almost entirely to “Regulations,” which are the direct responsibility of voters. That they weren’t taught that that in school is yet another feature of those voting decisions.