The notion of time being a valuable commodity is deeply ingrained in the American psyche. To understand this a tad better, Empower, a financial planning company, conducted an intriguing survey. Between March 11 and 14, they posed an interesting question to 2,204 adults: “What is the monetary worth of an hour of your time?”
The responses were quite astounding. On average, the price tag Americans attached to an hour of their time was a hefty $240. When projected onto a standard 40-hour workweek, this equates to an annual worth of $499,200 – a figure that’s almost eight times the mean U.S. income of $59,384.
Unsurprisingly, given the high valuation Americans place on their time, a significant number are ready to shell out cash to buy themselves a bit more time or to enhance their quality of life, as highlighted in the survey findings.
Empower’s interpretation of these findings was rather insightful, “The pursuit of happiness, whether that pursuit is a quest for a superior work-life equilibrium or a daily indulgence in a $7 cup of coffee, is an ongoing race.”
Which generation treasures their time the most, you might wonder? Well, this valuation of time appears to be influenced by age, as the data shows.
Millennials, those born between 1981 and 1996, assigned the greatest worth to their time, estimating an hour to be valued at $328.84. Interestingly, a quarter of millennials believed an hour of their time was worth over $500, the highest proportion among all generations. In contrast, only 6% of Baby Boomers (those born from 1946 to 1964) estimated an hour of their time to be worth $500 or more.
Gen Z, the generation born between 1997 and 2012, assigned a price of $266.92 to an hour of their time, while Gen X, those born from 1965 to 1980, estimated their hour to be worth $215.90.
Baby Boomers, those born between 1946 and 1964, placed the lowest value on their time, estimating that an hour of their time is worth a modest $137.19.
Millennials, in particular, exhibit a heightened sense of time’s worth, and perhaps this can be attributed to their unique experiences. For instance, many in this generation experienced the turbulent times of the 2008 financial crisis just as they were stepping into the workforce, and the instability brought about by the recent pandemic. Further adding to their unease are the highest levels of student debt ever recorded, coupled with soaring inflation and mortgage rates – conditions that have, according to millennials, hindered them from owning homes. These factors combined have led to a sense of lost time amongst millennials, Empower expounded.
When asked, “What would you sacrifice to reclaim an hour of your time?” the responses were telling. Time, it appears, is so treasured that 26% of Americans would willingly accept a 15% reduction in salary for more leisure time. Millennials displayed the most readiness to make this sacrifice, with 41% agreeing to the pay cut, Empower noted.
Moreover, Americans are willing to pay for services that would help reclaim some of their time.
For instance, 36% of those surveyed expressed that they’d prefer to pay a premium for delivery rather than drive 10 minutes to pick up an item. Over two-fifths of Americans believe that outsourcing household chores contributes to a better work-life balance. When it comes to skipping tasks like cleaning and yard work, a third of Gen Z would willingly part with up to $5,000 a year, and 36% of millennials would spend up to $10,000 a year for someone else to handle in-house chores and prepare meals.
Interestingly, Americans also seem to have a distaste for managing their finances. Over a third of those surveyed admitted to procrastinating on financial tasks such as bill payment. Furthermore, 26% indicated that they’d be willing to spend $5,000 annually to have someone else oversee their long-term financials, investments, and savings.
What are the factors that make individuals feel affluent?
For a majority of Americans, wealth isn’t solely about the balance in their bank accounts. A significant 63% reported feeling “wealthy” if they have sufficient time to spend with their loved ones, according to the survey.
An intriguing revelation was that almost one-third of respondents are comfortable accruing debt if it allows them more free time or facilitates a memorable experience.
A substantial 40% of Americans stated that saving time holds greater importance than saving money – a sentiment that is more pronounced among millennials, with 52% subscribing to this view, the survey indicated.
Pivoting to the topic of retirement savings, the survey unveiled some interesting insights. Close to half of Americans feel like they’re racing against time to save for retirement, despite 44% asserting they commenced their savings journey early enough.
A significant 43% expressed a wish to turn back the clock to start saving at an earlier stage. Yet, nearly half of the respondents would opt for a longer retirement with less financial cushion, rather than postponing retirement to amass more wealth, the survey revealed.
However, the overall sentiment remains positive. Americans, in general, exude optimism, and they may be farther along in their financial journey than they perceive, the survey suggested.
The mean 401(k) balance stands at $291,810, and this figure escalates to $580,259 for those in their 50s who are on the cusp of retirement, as per the data from Empower Personal Dashboard.
