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Have a Daisy of a Day
Time & Money Equal Components To a Balanced Life
“The cost of a thing is the amount of what I call life
which is required to be exchanged for it, immediately or in the long run”
Henry David Thoreau
______________ Under Construction ______________
Well Being or Wealth / A Wealth of both Time and Money
Based on graduate work completed at the
College of St Scholastica, Duluth MN
Catalogue Listing of Thesis “Wealth: Management of Time and Money within the
Household” Spring
1999
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Definition
Wealth or Well
Being as used by this work
Take the Test Measure your household’s available time
and money
Time Time as an economic variable
Money Money is the ultimate limitless resource
Management What is
the economic impact of Time and Money on the household
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Definition Wealth – A profusion of abundance. A great quantity of valuable material possessions or resources. All goods and resources
having economic value.
Eventually this site will contain the result of my graduate
work, studying wealth using two economic variables, Time and Money and the
interaction of both resources reflecting the well being of the American
household.
The purpose of this project is to understand real costs and
benefits of dual and single income households.
The test below was designed to test time and money variables within
single and dual income households. A
third variable, management, measures efficiency in the use of Time and
Money.
The hypothesis states that
by using good management skills, a single income household can maximize time
and money. A single income family
employing a high level of management may have nearly as much net worth plus
more time than a dual income household.
The result is greater abundance of the combined rescues, or greater
wealth. Evaluation of the survey data
suggested support for the hypothesis that a single income household enjoyed a
higher degree of wealth, a combined level of time and money.
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Take the Test Use
the Tab
Key on
your keyboard to make your life easier while using the test.
This particular calculator is set up to
measure two adults in the household. For
Single
Adult Household enter the same number for each Adult in
reference to Time and Age (The test is set up to measure averages) * Most
single Adult households show that they are short on time according to
research.
Interpreting results: Your
information is compared to a benchmark and will show a number (+
or – 1.0) . A result over 1.0 is better than the benchmark
and below 1.0 is less. You will receive
a result for Time, Money, and Well being.
Watch to see if you are above or below 1.0 and that will tell you where
your strengths and weaknesses are in your pursuit toward well being. Benchmarks are described in the subheadings
for Time, Money & Wealth. _______________ _______________ _______________
1. Start by
entering the number of hours each adult has per day for discretionary time, free
time. Enter the number of hours per day for each adult. Use a decimal for
partial hours. (Example 3 hours 45 minutes = 3.75)
2. Enter your
ages.
3. Finally,
calculate the amount of assets you have, and the amount of liability you have.
Think of it this way: How much would you have if you sold every thing you
owned? How much would you pay to settle everything you owe?
Hours of Free Time Per Day:
Show Total Free Time, Time Index, Net Worth, Benchmark and Money Index
This is your Wealth Index:
Your Score: 1= Benchmark >1= Better <1=
Below
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Time People tend to quantify time by putting a
money value on it. Ben Franklin said it
best when he announced his famous adage “Time is Money”. The reverse of that statement is also true. Money is time because it represents the time
given up to earn it. Even unearned
income, dividends and interest, represents the original time spent acquiring
money. Many households operate using
their available time to capture money, through jobs, to buy assets.
Gary
Becker, Economist states that “all time is productive”. He introduced the concept of market and non-market time in 1965. Market
time represents time spent for monetary reward, while non-market time does not have a monetary component. Non-market time is still productive in
advancing household well being. It
refers to productive time, not earning income.
Non-market time accounts for 80% of the time available to the family.
According
to J B Schor, (The Overworked American
week of discretionary time is necessary to
maintain psychological balance. The test
above uses 35 hours as the benchmark.
One
thing to keep in mind: Time is finite. Nothing else matters much once you run out of
time. Attempts to make time limitless
occur by stacking. Stacking refers to doing more than one task at a time. For example, a person can talk on the phone
while sitting on the deck in the sunshine, writing a note and drinking a soda.
Three
coping strategies employed by both men and women who are short of time are to cut back on sleep, to let things go, and to take care of personal issues while at work. In addition, the household uses a fourth
strategy. The Lack of time results in outsourcing, or hiring others, for work
at home. The act of paying for work at
home deteriorates the benefit of additional income earned working. Consider that the wage earner pays taxes on
income. With the after tax income, he
pays for someone else to do work at home with pretax dollars to the worker. The result is the individual has diluted his
earnings twice.
The
contributors to time erosion are the prevalence of two income households,
exaggerated perceived needs in the form of increased consumption of goods, and
time spent both buying and maintaining goods.
Higher standards equate to more expense, which requires more time
earning money.
The opportunity cost of choosing one thing
over another to spend time on gives us a value that we would otherwise have
received from spending time on something else.
Organizing Time. A value is
derived when time is maximized to achieve the best end result. Beacause of the
varied dimensions of time, organization of the resource is vital. As in any business, time must be utilized
efficiently in order to achieve a positive end result. The household benefits by getting the most
out of both market and non-market time.
Two
hundred years ago, the market had less importance to individuals. Societies were built on independent agrarian
households which were primarily self sufficient, and depended on the market to
supplement rather than support their needs.
Now the market is predominant in importance to the household. The result is a slow erosion of leisure time
in American households.
Two
thins came out of Industrialization; 1. Time was used to regulate labor. 2.
Time became an economic variable.
Individuals thought that they would be getting a better life by selling
their time for the commerce of industry and a steady paycheck. It appears that individuals gave up control
when they sold their time. By losing
control over this fundamental resource, the household’s quality of life
suffered.
There
is a perceived time crunch in
Employees
are working an average of 47.1 hours per week now as opposed to 43.6 in
1977. A 1997 study found that 63% of
American workers felt that they would like to work an average of 11 hours less
per week.
Households
appear to be stressed due to a lack of discretionary time. There is an ongoing debate on whether or not
technology actually has created more time or work for households. A week holds 168 hours of time. Vickery (1977) writes that individuals need a
minimum of 81 hours per week for personal maintenance, which includes sleeping,
resting, eating, and personal care.
The
average household with one child spends the following amount of time each week:
Food
Activities House Care Care of Clothing Family
Care Management Total
16 hrs 13 hrs 8 hrs
15 hrs 10 hrs 62 hrs
Click Here for Interesting Related Sites:
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Money Money is the ultimate
limitless resource. Theoretically,
money can be accumulated indefinitely.
The acquisition of money is limited by time. Cash flow alone is not an indicator of family
wealth. It is the relationship between
money, debt, and saving that determines the money component of the
household. The issue is not how much can
be earned, but how well the resource is managed.
There
are three things that can be done
with money. It can be spent, loaned, or invested for
ownership. If the money is spent, it is
gone. Both the money and the time spent
earning, become finite because the reward is confined to the purchase of the
material good or consumption. If the
money is loaned, as in a saving account, it will be returned with
interest. The third option is investing
in ownership of an appreciating asset like company stock or property. Saving and investing add value to the household
by capturing a future return. The time
spent originally earning the money continues to reward the household. Factors like time spent earning and the time
value of money create wealth.
Census
information shows that the average saving rates among American
households is below 1%. The average rate
between 1990 and 1996 was 4.8%.
Historically, the rate has been much higher. The average saving rate from 1930 through
1989 was 7.1%.
One
would assume that by increasing overall work hours, saving rates would increase
proportionately. But it does not appear
that the increased frequency of second income households have effectively
increased saving rates over the last 70 years.
Consumer
debt is increasing while the percentage of saved income is decreasing. If more households are comprised of two wage
earners, then, where is the money going?
Is the second wage earner contributing to or reducing the overall
well-being of the household?
Money Stress:
There is a growing problem of economic distress among American
households. It has a pervasive and
negative effect on household well being.
The major components of economic distress are; “employment instability,
employment uncertainty, economic deprivation, and economic strain” (Voydanoff, 1984, p. 274) It was found that income components
were a factor in household satisfaction, however, employment factors were
not. There is less correlation between
employment, or the lack of employment, and economic distress. Economic distress is related to household
satisfaction as it relates to the availability of resources.
Stress
is found to be reduced in households with “financial resources, adaptive family
system characteristics, and social supports” (Voydanoff,
1984, p 278) This
suggests that household well being is a function of managing the money and that
maintaining a job is a secondary issue. Resource
insufficiency is more debilitating than downward job mobility (Voydanoff, 1984, p. 277)
Money Control: It has been found that perceived control
of resources is the determining factor to managing both time and money within
the household (Danes and Rettig, 1993) Actual control follows when perception
exists. When individuals within the
household believe they have control of their financial situation, they are more
likely to make positive behavioral changes to fortify the household’s well
being. It was also found that income
level and net worth are less of a factor than perceived control in regard to
household finance ( Danes and Rettig,
1993, p. 385)
It is
possible that dual income households perceive themselves as having an
exaggerated amount of money. This perception masks the need for management
of time and money. The result is a lack
of saving and increased debt. Overspending leads to increased time spent
working to satisfy debt. More time
committed to work leads to rewards to justify the work. The situation feeds itself.
The
conclusion is a household’s locus of control is more important than the amount
of income generated or employment status (Danes and Rettig,
1993; Hilton and Devall, 1997; Hira,
et al.,1993; Walson and
Fitzsimmons, 1993; Voydanoff, 1984; Voydanoff et al., 1988)
Social psychological variables such as planning, budgeting, spending,
resource allocation, and ability to achieve success, were greater factors in
well being than economic variables. The
economic variables include income, net worth, debt to income ratio, and
employment status (Walson and Fitzsimmons, 1993, p.
212) The social
psychological variables relate to control, while the economic variables relate
to income and employment.
Think
Smart when it comes to money. There are a lot of people out there who run companies designed to
get your money in their pocket.
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Management Under Construction
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Contact
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Last Updated 7-1-08