Each week I meet up with a friend of mine to play squash. It’s 45 minutes of great exercise but the bit I enjoy most happens before and after the game - a catch-up. A chance for us both to have a chat and talk about what’s going on in our lives.
A few weeks ago during our pre-match chat, my friend told me that he had just completed his tax return and received the result, he was getting a nice rebate that would pay for his upcoming holiday, allow him to buy a new guitar and still have enough left over to put quite a bit into savings. Great news and then came the kicker - I learned that he had earned 25% more than me last year.
Ouch, that hurt.
For years we had been earning roughly the same amount as each other, or so I thought. Obviously things changed when I started my own business, as my income dropped dramatically but now I had been running for a few years, I thought we were close again.
I was wrong.
Immediately I started questioning everything. What was I doing? What’s wrong with the business? Why aren’t I earning as much? I’m a failure.
That’s my problem, I always overreact and then I analyse what’s really going on and then feel much better about things.
My business has been running for three years now and each year turnover increases by 33%. Not bad and if this continues, next year I will be earning more than my friend.
I then realised what for me, was the best bit. The bit that made me relax. My friend works at least double the number of hours that I do. He works 12 hours a day, Monday to Friday. Sometimes he even works on a Saturday.
It’s a lifestyle choice
Let’s look at this mathematically.
He works 12 hours a day or 60 hours per week, on average. Let’s assume that he makes £100,000 a year. For simplicity, let’s also assume he has no holiday and works 52 weeks a year. That means that for every hour he works, he earns £32.
Now, let’s say I earn £75,000 (25% less than my friend). If I work six hours a day, five days a week, for 52 weeks a year, for every hour I work I earn £48.
Ah, big sigh of relief. That looks better doesn’t it?
Of course this is just simplified but you get the idea. I’m actually earning more per hour than he is. I work fewer hours, I spend more time with my family and I don’t have to get up at 4a.m. every day and travel to London.
My friend has more money in his account at the end of each month but is it worth it? Given the choice, which option would you choose - more money or more time?