Time, with the eyes of an investor

If you are working in finance, then you must have heard about ROI (Return on investment). This is the term we use to know how we are earning on our investment and as all good investor we want our ROI to be highest. But we took it only on money purpose. If we think deeply money is not only the investment we make, time is also a big and major investment. This includes everything. When we are doing anything then we are investing our time in that. Even when we are watching TV we are investing time, if serial is good then we are getting good return as entertainment but if serial is bore then it is waste of our investment (money).

In many ways time is more valuable than money. You’ll always have the opportunity to make more money, but once time has been spent it’s gone forever. When you think of time as a commodity, and all of your actions as investments, it changes the way you approach every day decisions.

We spend time in many areas like playing, working, sleeping, eating etc. All are necessary but like in business we need to make preference list. If we are investing our time in one area more than others then we must ensure that that area is necessary for that much investment. There is no exact formula/ratio like business for how much we should invest in which activity. This depends on our experience, knowledge and preferences.

Here I am suggesting three ways by which we can maximize our return on investment of time

1. Get multiple positives: as discussed, we can spend our time in many activities, but like business we must spend our time in that activity from which we can earn multiple benefits. Like writing article, it can earn money, enhance your knowledge of subjects, goodwill as expert etc.

2. Avoid multiple negatives: like some actions have multiple positives, there are some actions which have multiple negatives. One of the popular weaknesses of many people is going out drinking. This hurts them in three ways: the time spent isn’t productive, drinks are expensive, and the effect of staying up late and being hung-over usually ruins the following day.

I am not saying that you must left this type of habits. Because it is habit so you can’t leave it, I am saying that you must invest less time on this type of activities.

3. Benefit of compounding interest: every finance person knows when you make investment, you earn interest and then on that interest you earn interest. So after many years you got a handsome amount of money for your investment. The same concept applies to time. If you invest time by working hard when you’re young, you put yourself in a position to succeed that will continue compounding for the rest of your life. If you waste time when you’re young, you can’t make up for it later because you’ve lost the opportunity to utilize the power compounding.

Many people think their time isn’t valuable when they aren’t working, so they throw it away on activities that have a poor return on investment and don’t build for the future. The truth is, no one else is going to consider your time valuable until you do. If you want to acquire the wealth that will provide the freedom to live your ideal lifestyle, start thinking of every decision as an investment. Nothing is insignificant.