Everyone knows this, but very few do it!

Smart and successful people know that your most precious resource is your time… you need to place a value (ie: a $$$ figure) on your time and start outsourcing your life more!

The general rule is… if you can get someone else to do a task for less than what you can earn while they are doing that task, then outsource it ASAP!

Rachel (my wife) and I outsource far more than anyone we know. For example, some of the people we outsource certain life and business tasks to are house keepers, cleaners, nannies, personal assistants etc. Some of the tasks include cleaning, baby sitting, shopping, grocery delivery…

If your time is worth $250/hr, then why are you cleaning your house 5 hrs per week? You could have a cleaner for $20/hr and you could be spending the time with your family/kids, or working to increase your income and net worth? Unless you love cleaning of course ;)

This is how I work out my hourly value…

Calculate your net yearly income (ie: income after tax), add your estimated increase in net wealth for the year, then divide this figure by the hrs in a year that you have time to do things (ie: 10 hrs/day, 5 days/week, 48 weeks a year = 2400) = $x/hr in hourly value

Lets run an example…

$65,000 (lets assume a $90k income) + $100,000 (lets assume an increase in your home equity of $50k and an increase in your portion of the net worth of the start-up you have founded of $50k) = $165,000 / 2400 hrs = $68.75/hr . So if you can get anyone to do something that you dislike doing (and they do a comparable job) then outsource it ASAP and create more value.

Note: These is a very basic equation and everyone uses different metrics to measure their hourly value, however hopefully you can use this as a starting point and work out what works best for you. For example, you may include total yearly income (including tax) if you are looking to outsource a task that you can use as a tax deduction (ie: a business expense). You can also add an opportunity cost element into the equation to account for the potential of a greater increase in expected net worth the more you are able to free up your own time.

Note 2: Do not outsource tasks that you enjoy doing and actually improve your quality of life (ie: spending time with your kids)

Note 3: You can take this to the extreme by outsourcing the running of your company to free up your time to think of and start up your next company. This is exactly what I have done with ineedhits. We have a great team of people running ineedhits, and it freed up myself and Rachel to start property investing, start a family, and also Vibe Capital and Minti. Caution on this one… you need to really plan this well. It took us about 3 years to find the right person and implement the succession plan.