Time and Money: 5 Proven Lessons to Remember

Time and money are two critical resources. We make trade-offs to spend time or money in one area versus another. 

Many people have a long commute for their full-time job and do side-hustle on their extra hours to get extra money to top up their monthly take-home pay. They get the money but lose precious time. 

We’re not saying that you shouldn’t work more, we’re just saying there’s a difference between working longer hours and working smarter. You can have money for working longer hours, but you’ll lose the time. You may have the time but less money. 

When you work smarter, you can get both. In this article, you will learn five proven lessons to ponder on how to value your time and money and maximize them to achieve financial security without working for your entire life and sacrificing the important things in life. 

1. A dollar saved today is a dollar earned tomorrow.

Money is essential. The best way to save money is by planning, which means having a budget and sticking to it. If you don’t know how much money you have available for any given month, or if you’re constantly overspending without realizing it, it’s time to get organized and be more conscious of your daily and monthly expenses. 

Once you’ve got a plan and budget in place and are saving money automatically every month, there are many ways to stretch your dollars further. 

Instead of spending $1,00 on a new phone you saw at the shopping mall, you could put it in a savings account and earn interest on it. 

The interest would be added to the principal of your savings account, which means that the next time you withdraw money, there will be more of it. You may invest it like in stocks and expect it to grow with time and make profits.

We have to sacrifice one thing for the other that is more valuable. You will reap the benefits of saving and investing, and time plays an important role. As they say, “Save money, and money will save you.” 

Saving money now can mean spending more on things with greater value, like buying properties, preparing for wealth for your offspring, or saving for retirement. And on rainy days, it is something that you will be thankful for because you did it. Let’s face it, we know life will have events for us where we need a backup plan.

If you have the cash flow, emergency funds, and savings for future expenses, you no longer need to borrow from anyone or sell your items just to get the cash you need. You become self-sufficient when you have planned out everything from your financial and retirement goals and executed the right ways to manage your finances. 

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2. Live within Your Means 

We feel guilty about buying something we don’t need with our hard-earned cash. We buy stuff we don’t need because it’s on sale or will give us a quick fix of joy, a level of happiness that doesn’t last for long. We pay for things we think will make us happy, but in the long run, they just make us want more. 

Living in a materialistic world is not easy. Even the most organized person can be tempted into purchasing something they don’t need. We must understand the more profound reason we sometimes make an impulse purchase.

Spending money is like playing the lottery. Our brain signals that we’ve won. The more we spend, the more we want to play the lottery. Our brains are hardwired to associate spending money with positive experiences. When we spend, our brain rewards us with a feeling of success. 

As researchers have discovered, this effect only grows stronger over time: the more we spend, the more dopamine floods our brains, making us want to keep spending even more. You get a rush when you see that item, and your brain releases dopamine, which is associated with excitement and pleasure. It’s easy to understand how this might lead to overspending. 

A study published in the Journal of Consumer Research found that even thinking about spending money can cause the same kind of chemical reaction (dopamine rush) as actually spending the money.

In fact, some researchers now believe that people who are prone to overspending are more likely to have a more robust response to chemical reactions–meaning they’re more likely to become addicted. If you have a problem controlling your spending habits, it may be time for you to take action.

It’s time to live within your means and manage your spending.

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The first step toward stopping overspending is to create a budget for yourself. This will help you understand where your money is going and what areas need improvement. 

You should also consider writing down all the purchases you make throughout the month to know  what’s coming in and going out of your account. This will allow you to see where changes need to be made.

Another way to stop overspending is by putting together an emergency fund covering at least three months’ expenses. This will protect against unexpected cost like medical bills or car repairs and help keep your financial situation and peace of mind intact.

If these tips don’t work for you, consider seeking professional help from a counselor specializing in money issues or personality science.

You may visit the website of the National Counseling Society. They can help you with your financial problems and mental health. Their advice may be just what it takes for things to finally fall into place.

3. Be careful about thinking about your time as money because time is not the same as money.

Time is not money. It’s tempting to think of it that way, especially in the context of work or business. You feel like losing money if you don’t get paid for your time. When you’re spending time on something, it’s costing you money—your opportunity cost.

But the truth is that time is not just about that. It’s more complex than that.

The value of your time does not come from its ability to be traded for money—it comes from how well you use it, how effectively you manage it, and what you choose to do with it. If your life is full of activities that bring meaning, satisfaction, fulfillment, and greater happiness, then your time has been well spent. 

And if you spend a lot of time on things that bring no meaning or satisfaction, then maybe it’s time to reevaluate how you spend the hour of your time.

Related:  Time vs Money: Which is More Important in Life?

4. Don’t put off saving for retirement until you are more financially secure.

Start saving early and invest your savings. Studies show that people who start saving for retirement when they are young end up with more money in their account than those who wait until they are older and have more financial security. 

One survey showed that people who started saving for retirement at age 25 would have an average of $2 million in their retirement accounts by age 65, while those who began at age 35 would only have an average of $1.3 million.

It’s a good idea to start saving early and invest your savings. If you wait until you have a lot of money saved, it will be too late to begin investing. 

In the United States, most people invest their money in 401(k) or Individual Retirement Account (IRA). A 401(k) is a retirement plan offered by an employer, while an IRA is something you open and manage on your own.

If you don’t have an employer-sponsored plan at work, opening an IRA makes sense because you can contribute more money than a 401(k). The earnings on those investments can compound over time so that even small contributions can grow into a substantial sum. 

If you’re over 50, the 401(k) allows you to set aside more money for retirement each year than an IRA. In 2022, the maximum contribution limit for a 401(k) is $26,500 compared to $7,000 in an IRA. There are many different types of IRAs, so do your research before deciding which one is right for you. 

You may also grow the value of your money by investing in real estate, stocks, index funds, and ETFs (exchange-traded funds). Real estate is one of the most common choices—and it’s easy to see why. 

You can buy a piece of property to rent out to tenants and collect rent from them each month. This will help you earn more money than if you had simply put it in a savings account or stuffed it under your mattress.

If you want to know more about multifamily real estate investments, grab a free copy of  Wellthy Capital’s Path to Wellth E-book. 

Related:  Multifamily Real Estate Investments: An Easy Guide to New Investors

Stocks are another popular investment choice because they offer an opportunity for growth over time. It’s essential to choose wisely, though, because not all companies succeed—and if you invest in one that doesn’t perform well, you could lose some or all of your initial investment. 

Mutual funds are another option for investors who want to diversify their portfolios across multiple investments without doing the research themselves. 

There are many different types of mutual funds available, too. Some focus on certain kinds of investments such as real estate or stocks. In contrast, others provide exposure to multiple asset classes at once. 

Remember, the sooner you start saving and investing, the higher your money’s future value will be, especially when you reach retirement. You may not get the earnings immediately, but they compound and add up over time.

5. Most millionaires are self-made and didn’t inherit their fortunes.

Most millionaires are self-made and didn’t inherit their fortunes. Only about 2% of American millionaires inherited their wealth. These wealthy individuals understand the importance of savings, the basics of investing, and how to calculate risks. They are brilliant in increasing their cash flow through passive investing.

Recommended Video:  Building Real Wealth: Living Life on Your Terms 

Many ultra-wealthy individuals invest in real estate, gold, and other tangible assets to balance out the volatility of stocks. They are attracted to properties with tax advantages and high returns. They increase their wealth in the right way without sacrificing their lifetime.

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If that sounds like the person you want to be, we’ve good news for you: becoming a millionaire is possible.  It may not be easy. It will require a lot of hard work and dedication– but it’s possible if you just keep at it and don’t give up when things get tough.

Related: The Millionaire Next Door: Here are 7 Remarkable Lessons Learned

Conclusion

The bottom line is that it is time to break the vicious cycle of spending time and money. Grow your time and money by using the skills and talents you have gathered, and nurture your social connection where you can learn new skills and ideas, particularly in wealth management.

Suppose you are interested in enriching your mindset on how to manage your finances, become wealthy, and have a healthy disposition in life. In that case, you may use your spare time to learn from us on financial education to understand the value of saving and passive investing in a way that simultaneously saves time and grows your money. 

Related: Financial Independence: What is the Valuable First Step?

Listen to The Path to Wellth with Hannes Hennche podcast on Apple, Stitcher, Spotify, and Youtube and you will learn a lot on how to use your time in growing your wealth.