If time were a currency, it would fluctuate more than the pound after a Brexit. Getting the most value from your time is all down to how you spend it – and invest it. If you’re curious as to why people seek professional advice, then you need to understand the exchange rate of time. Article by Nick Green.

Which is the most volatile currency in the world? It’s not the ruble, the peso or even the Hungarian forint. You’ll find much wilder exchange rates going on in the humble hours, minutes and seconds on your wrist watch.

You see, a minute of your time isn’t worth as much as a minute of mine. Except sometimes. And sometimes your minute is worth two of my hours. Because it depends on how we’re spending that time, and what we hope to get in exchange for it.

Time really does work like money

Confused? Here’s an everyday example from the workplace. A senior executive wastes two hours prodding at his laptop in frustration. The IT technician could have fixed the fault in five minutes, but the executive was too stubborn to call her. As a result, the executive is late delivering important figures to the company director – so the company director wastes half a day sorting out an issue that the senior executive should have been able to handle in half an hour. So five minutes of the IT expert’s time is suddenly worth many hours of the company director’s.

While in the meantime:

It's clear that the company director is capable of achieving crucial tasks in minutes that would take the executive much longer, and which the IT technician probably couldn’t accomplish at all. So the company director’s five minutes is potentially worth weeks of anyone else’s effort. When people complain, ‘This isn’t the best use of my time,’ that’s exactly the sort of thing they mean.

When you spend time on the wrong things, its value plummets

Most people could fix a dripping tap with the right tools and a complete set of instructions. But it would still take most of us far longer than it would take an experienced plumber (and we might also worry if we’d done it right). There’s also the equally important question of what else you could have been doing, if you hadn’t been fiddling with washers? What could you have achieved with that time by doing something you’re good at?

That’s the exchange rate of time. We obtain most value from it when we spend it doing what we do best, or what we most want to do. When we spend it ‘abroad’ – that is, on things we don’t want to do or aren’t so good at – then we can get a raw deal.

‘Just Google it’ – the illusion of empowerment

Today’s digital age makes it tempting for the layperson to have a go at many unfamiliar tasks, from plumbing to their own personal financial planning. A vast array of online information and tools means that people feel empowered to carry out their own repairs, diagnose their own illnesses and perform various other tasks that traditionally were left to experts. This can include making their own financial decisions on key issues such as pension and retirement planning. But feeling empowered isn’t the same as being it.

The web is a notorious free-for-all. It can be hard to distinguish fact from opinion, or to tell what is simply good marketing. There is also the very real danger of highly convincing yet fraudulent sites. Even with sites that you know to be reputable, you still have to apply that information to your own situation, with no independent confirmation that you have done this correctly. It’s possible, of course, and some will find it easier than others. But conducting and then checking your own research is inevitably time-consuming, and like the DIY plumber you will still have those doubts about whether it is really watertight.

Achieving maximum payout from your time

At best, taking the DIY approach to financial planning will consume disproportionate amounts of your time; at worst, it can result in very damaging decisions where you have no recourse to compensation.

By contrast, a single hour spent with a financial adviser could be worth many days of your own time, which you might otherwise waste in tedious web searches, reinventing wheels that your adviser already has in stock. Furthermore, you have the added assurance that your IFA is regulated by the FCA and obliged to act solely in your best interests.

You should find that the value of advice goes beyond any monetary returns on your investments, because the saving on time, effort and stress is beneficial in its own right. After all, you could be using that time to make more money to invest. Or better still, enjoying the fruits of spending it.

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