Investing Isn’t Just About Money

When I first sat down to write the Investing in Yourself series, I was mostly thinking about financial investments – how can you invest money in yourself in order to increase your earning potential? What the series actually pointed out to me, however, is that investments really take on a lot of forms and you can often transform one type of investment into another.

For example, take The Simple Dollar. For me, it’s a money investment (hosting fees), a time investment, an intellectual investment, and a bit of an emotional investment, too. What do I get out of it? I reap some financial rewards, increased knowledge and understanding (as a result of the research), improved writing skills, a network of acquaintances, and the wonderful feeling one gets from helping someone. Is it enough reward for the time investment? I believe that it is, but it’s probably not an exchange everyone would see value in.

There are lots of ways to invest in something.

Money is the most obvious investment. It’s very easy to see how financial investments increase in value over time just by itself, let alone how you can use money in effective purchases to improve your situation. Most tangible goods in some way fall under money, as they have some sort of direct monetary value.

Time is also rather obvious, and for me it’s the more valuable investment. An hour of your time should reap some sort of reward, and that’s why I think that many people were frustrated with my recent article about personal appearance and hygiene – for some, the benefits of the investment of time in cleaning yourself is so obvious as to be idiotic (and thus some seemed to be insulted by the article), but yet for others it’s not something worth investing their time in because they don’t really see the benefit. The comments on that post make that dichotomy clear (and convinced me that I made the right call in posting it).

There are other investments as well. Emotional involvement is one – whenever you become emotionally involved with something or someone, you’re hoping for a positive outcome. I immediately think of my sister-in-law here, who works at a job that she’s deeply emotionally involved in without much pay. For her, it’s much more than just a time investment. It’s passion.

Intellectual investment is another important one. For example, I often come home from my regular job with my brain completely drained of mental energy. It’s almost all I can do to raise up the mental energy to engage with my family in the evenings at times.

Along these same lines, not all investments pay dividends in the form of money, either. There are rewards in the form of time, in the form of emotion, and in the form of self-improvement as well. Again, looking at investment rewards from this perspective brings my sister’s job into clear view. She works at an emotionally involving job, investing her time and emotions greatly into her work. What does she receive as a reward? Money’s just one part of it – it leaves her with a great deal of emotional reward, too, from the upfront happiness of bringing a positive change to people’s lives to the overall satisfaction of doing something that fills a true social need. Overall, the equation balances out for her, even if looking at it from a time-for-money perspective makes it look as though she’s getting a raw deal.

When you start looking at investments from a wider perspective, lots of interesting aspects of life come into view.

Time-wasting activities seem more wasteful than ever. I’ll be the first to confess that the hour a week I spend watching Lost is probably not the best time investment. I spend an hour of my time, a bit of my mental energy, and a tiny bit of money on a show solely for the entertainment factor. Do I get enough out of that time to make it worthwhile? It’s rather hard for me to make that case, even for a show that my wife and I both get a lot of enjoyment out of, thus it’s almost impossible for me to make the case for just flipping on the television and staring.

Things that previously didn’t seem like investments seem more like investments. The personal appearance and hygiene article comes to mind again. Most people don’t think about this as an investment, but that’s exactly what it is. You’re investing time and a bit of money in exchange for a better appearance and slightly better health. For most people, this investment seems like such a no-brainer that it’s not even something to think about, but for others, the costs of this investment (mostly the time lost) isn’t worth the reward.

Maximizing the value of your investments takes on a whole new light. It goes beyond maximizing the cash value of an hour of your time. If you can spend an hour doing work that’s incredibly grueling and draining for $20, or you can do something very easy for that hour for $18, the $18 is a far better investment opportunity because it leaves you with energy for other tasks. I think back to a time two years ago where a penny-pinching travel companion of mine insisted that we sit in an airport for eight hours to save $30 on an airline ticket – for him, that was a good investment because he could cozy up in a chair and read, but for me, it was a terrible investment because I wanted to see my infant son quite badly.

Think about things in your own life that drain your emotions, your mental acuity, and your time. What rewards do you get from those activities? Are there other opportunities where you could get more value out of your investment?

Trent Hamm
Trent Hamm
Founder of The Simple Dollar

Trent Hamm founded The Simple Dollar in 2006 after developing innovative financial strategies to get out of debt. Since then, he’s written three books (published by Simon & Schuster and Financial Times Press), contributed to Business Insider, US News & World Report, Yahoo Finance, and Lifehacker, and been featured in The New York Times, TIME, Forbes, The Guardian, and elsewhere.

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