Wise Money: Trading Money for Time

Quote to Ponder

“Seek wealth, not money or status. Wealth is having assets that earn while you sleep. Money is how we transfer time and wealth. Status is your place in the social hierarchy.” - Naval Ravikant

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Insight

If you seek wealth to increase your social status, you will never have enough.

The real benefit of wealth, however, is control. Wealth allows you to control the one asset you have that you cannot create any more of: your time.

As Naval Ravikant pointed out, building wealth allows you to trade money for time. This point struck me the other day as I drove home from work and passed one of the many bus stops along my route. Having a car that I can drive whenever I wish takes me roughly 8 minutes to drive home.

If I could not afford a car and had to take the bus, it would take about 33 minutes, not including all of the time spent waiting for the bus to arrive. Multiplying the 25-minute difference by twice per day and 250 days per year adds up to 208 hours per year, or an extra 8.7 full 24-hour days spent commuting PER YEAR! Multiply that by 40 years of work, and you have spent one whole year of your life commuting by bus compared to by car.

Many of us take for granted having a level of wealth and income that affords us the time savings that car transport provides. But it truly adds years to your life!

Seeking wealth for social status is a fool's errand that will leave you just as unsatisfied as when you started. However, using wealth as a tool to free up your time will undoubtedly add to your happiness.

So trade money for time, not time for money. You’re going to run out of time first.