Finance for Women
Module 5: Highlight your good points

Hello again.

Take a moment right now to reflect on how far you’ve come already. Think back to when you began this programme. How much did you know about your money and your attitude to money then? Now think about what you know today. How does that feel? You have done so well.

In this module we’re going to look at your income and the value you put on your time. So let’s get on with it.

Part One

Time and Money

What you choose to do and refuse to do with your time speaks volumes about the value you place on yourself. Time might not seem like a financial issue at all to you. Sure we add it up in digits but that does not make it a money thing, right?

Wrong!

It’s no coincidence that we talk about how we SPEND our time. And we have all heard that time is money! It’s probably more correct however to say “Money is time” Let me explain the difference and why it is important to your financial life.

We’ve all seen a movie where the busy business man shouts to the lowly assistant/taxi-driver/shop-assistant, “Come on, hurry up, time is money.” Usually it’s when the lowly assistant/taxi-driver/shop-assistant is taking too long to do whatever they are doing and making the business man wait thereby wasting his valuable time. His time is being wasted and as he commands a huge fee for his time, by default his money is being wasted. It’s easy to see how it works that way round.

Now think of the last time you went for some “retail therapy.” Off you went to the shops to buy something to cheer yourself up because you had a stressful day. You saw the “must have” handbag in the window and deciding you could afford it, you rushed in and paid for it. So far so good, nothing to do with time though. Really?

Let’s take a closer look.

  • How did you afford the handbag? You went to work.
  • And why did you go to work? To earn the money that bought the handbag.

So the handbag is in effect worth a specific number of minutes or hours of your time.

Money is time.

Was it worth it? Was the handbag worth a whole day/week of your life spent at work? Do you even know how much time the handbag cost you? What value do you put on your time? What value do you put on you?

I’m not suggesting for one moment that your value in this life is a computation of how much you earn broken down into the hours and minutes you spend to earn it. You are absolutely priceless, as is every single human being on the planet just because you exist.

I am however suggesting that your working hour has a value that is a very important component of your financial life. And your hourly rate is either good enough for you or it is not.

Part Two

One Woman’s Story

To truly understand the impact of hourly value let me tell you the story of a lady I know who was married but considering divorcing her husband because she felt his real love was his work. He worked all hours possible and rarely was home in time for dinner. The children were always in bed when he got in and weekends he was so tired he slept or vegged out in front of the telly.

They had a beautiful house, nicely decorated and with all the mod cons. They drove really nice cars. The kids had everything they needed. The only thing missing was their father being around and she had had enough.

Over lunch one day, as she insisted in picking up the check, I asked her why she would put her marriage at risk over me when I wasn’t a particular friend.

She stared at me like I was speaking a foreign language.

I then asked her how long extra her husband would have to stay at work to pay for the lunch she had just given me. I went on to ask her how long he had to work to pay for the sheepskin coat she was wearing, the ski trip the kids had just taken and the new suite of furniture she had ordered.

It took another few minutes before the penny began to drop.

Everything she spent on herself, the children and the house translated directly into hours her husband needed to work which translated directly into her thinking he loved his work more than her.

I suggested she add another item to her “Can I afford it?” checklist. I suggested she add “would I rather have this item or would I rather have my husband at home for the hours it would take for him to work to pay for it?”

She is not divorced so far.

Part Three

Hourly Value

You don’t really need some calculation to tell you if you feel that you are being paid what you are worth. You already know that in your gut. But you can look back at your list from last module. Did you end up with a net profit or loss?

If you had a net loss then you clearly believe you deserve more things in your life than your hourly rate allows you to afford. And look at your “must have” and “nice to have” lists. Can you afford your must haves? Can you afford your “nice to haves?”

Bear in mind when looking at these numbers, that I mean the real kind of “can I afford it” which is the “can I pay for this in cash today without using credit or taking money from my 10% personal financial future” kind of affording it.

There are two sides to the hourly value question.

One is a simple question of arithmetic.

  • Are you earning enough per hour to pay for the life you want to lead?If the answer is no, there are a number of ways to maximize your income.
    • You can work for a promotion or a raise.
    • Perhaps you can get mentored or trained for another higher paid position.
    • You can offer to work overtime.
    • You can learn new skills and offer them for an increase in salary.
    • You can change your job for a higher paying job or start a business or second income stream part time.
    • If you are self-employed you can raise your hourly rate, work more hours or offer more services.

    These are just simple ways. There are lots of creative ways to increase your income specific to you.

The second is a more emotional question.

  • Whether you are employed or self-employed, do you value yourself enough to ask for the hourly rate you are worth? Unfortunately, somewhere along the line in our cultural evolution, women were declared second class earners. And in order for this to happen, we had to be convinced that we were worth less in economic terms. And in order for that to happen, we had to be convinced that we were worth less… period.

Anyone who is particularly interested in the detail on the silent but horrific consequences of this reality on today’s women and tomorrow’s daughters can look at the work of Colette Dowling, author of the best-selling “The Cinderella Complex” and “The Myth of the Money Tree”

For our purposes suffice to ask the question

“What value do you put on yourself, manifesting as an hourly rate and is it right for your life?”

Action!

Actions of the Week

1. Calculate your hourly rate.

Take your monthly salary/income and divide it by the number of hours you work. Do not divide it by the number of hours you are supposed to work if you took all your lunch-breaks and went home on time every night. Divide it by the number of hours you actually work in an average month. If you have some, do not include income that you do not work for such as dividends or returns on other investments. This is called passive income. Calculate using only your active income; that is income that you would not have if you did not put in the work to generate it.

2. What are you really worth?

Take a new page in your notebook and write “My Worth” across the top. Explore how you feel about your hourly rate.

  • How does it make you feel?
  • Are you being paid your worth?
  • Is it smaller or greater than you expected?

If it is less than you feel you are worth economically write in large red figures the figure you believe you should be paid per hour. And then write 20 reasons why you are worth that figure. Finally, write one paragraph describing your perfect work and how you would be paid for doing that perfect work.

3. Increase your income

Divide a clean page into three vertical columns and make three lists of ideas on how you can increase your income. The first list is for the short term (1-6 months), list two is for medium term (6mths – 3 years) and list three is for longer term (3+ years). Make sure to put actual figures with your ideas. It is important to set real numbers targets for your mind to focus on.

4. Money or Time?

Go back through your expense list and calculate the time value of the items on there. Ask yourself if you would rather have the item or the time. Write about what you learn about yourself and your ‘must haves’ with this new awareness.

5. Waste some time on a weekday.

Go and do something that you would never normally do because you don’t have the time.

I’m not talking about something constructive that you’ve been putting off or couldn’t find the time to do. I have a friend who lives in a chalet in the Swiss Alps overlooking one of the best views in the world. Sitting beside his music system he has a tape cassette entitled “Music to stare out of the window to.” It’s a wonderful way to spend a morning. That’s the kind of thing I am talking about. Take a train ride just for the ride and back. Sit in the park and just watch people going by.

Relax and allow yourself to feel the preciousness of time.