Laura Rowley Money & Happiness

According to a recent issue of Medicine and Science, cleaning the house is a good way to lower your blood pressure. This is bad news for me, since I just hired someone to clean my house.

I knew there was an opportunity cost attached to the money I was spending. I hadn't considered the lost exercise opportunity as well. But hiring a housekeeper is like having kids: You have no clue how wonderful it is until you do it, and then you don't care what it costs.

On the other hand, it wasn't a decision I took lightly. I held fast to my toilet brush for nearly two decades -- even as I had three kids, continued to work full time, and moved from an apartment to a four-bedroom house. When I mention this, some people smirk, the way I used to smirk at my friends who grew up in Manhattan and still don't know how to drive. "Are you kidding me?" I can hear them think. Even the woman I hired smirked when I told her she was the first cleaning professional I had ever engaged.

Why did I wait so long? It was a combination of upbringing (my mother had 11 kids and never hired any help), fastidiousness, and miserliness. Over my working life, I figured I've probably saved between $30,000 and $40,000 dealing with my own dirty laundry.

But what I saved in cash, I paid for with convenience. I had countless arguments with my husband over whose turn it was to scrub the bathroom tile. And I dreaded returning from business trips, knowing a mountain of cleaning awaited me. Then, this summer, I was writing a book about a company that has made hundreds of millions of dollars from clients who outsourced non-core services to the firm. Click! The light bulb went off. Cleaning is a non-core function. There are people who are much more skilled than me and outsourcing allows me to better utilize my resources. (It was helpful to have a fancy business justification for something I'd wanted to do for a long time.)

Which brings me to the point of this column: What's your time worth? From an economic perspective, is it better to mow your own lawn or pay a service? Iron your own shirts or send them out? Cook or buy take out?

"I've always thought that if you had a little meter in your forehead that indicated how you value your time at any given moment it would be pretty shocking," says George Loewenstein, a professor of economics and psychology at Carnegie Mellon University. "People are often powerfully affected by the superficial features of situations."

A few examples:

• Thinking in percentage rather than absolute terms: While you might not drive 30 minutes across town to get $5 off a $200 DVD player, you might make the trip to get $5 off a $15 DVD, because you think one-third off is a terrific bargain. But in absolute terms, $5 is still just $5.
• The moral outrage factor: You spend an hour contesting a $3 mistake on your cell phone bill.

   

• The procrastination factor: You start a new job and drag your feet for two years before joining the 401(k) plan. In that case, you believe your time is literally worth hundreds -- even thousands -- of dollars an hour, because that's what you lost by procrastinating.

So how do you figure out what your time is worth? The most obvious way is to simply compare your hourly wage to the cost of the service. This web site, sponsored by the Small Business Administration, offers a list of salaries and a breakdown of your hourly wage (and even your wage by the minute). It assumes a five-day workweek, minus vacation and holidays.

Thus if you earn $75,000 a year, your time is worth $39 an hour. If your yard service costs about $40 an hour, you've got a pretty sound economic reason to pull out the checkbook instead of that leaf blower.

But that's not the whole story. Unfortunately, a sizeable chunk of your hourly wage goes to Uncle Sam. In addition, your buck goes a good deal further in, say, Hope, Arkansas, than Manhattan. A few years ago, economist Ian Walker of England's Warwick University created a method to calculate the value of one's time based on wages -- adjusted for taxes and the cost of living. To apply his formula to your situation:

1. Subtract your federal tax bracket from 100.

    

2. Multiply your hourly wage by that figure.

    

3. Divide the result by the average cost of living rating for your community available from this site produced by the American Chamber of Commerce Researchers Association, or ACCRA, a nonprofit group that compiles cost of living data.

    

4. Then take that result and divide by 100.

Here's an example: You're a single person living in Las Vegas, Nevada, earning $75,000 a year (or $39 an hour). Your federal tax bracket is 25 percent. The cost of living index for Las Vegas is 1.139. Given these particulars, your real hourly wage using Walker's formula is $25.68.

Now hiring that guy to mow your lawn (or, in the case of Las Vegas, water your cactus) doesn't look as appealing.

There are some logistical drawbacks to applying Walker's economic formula. It costs $7.95 to access your city's cost of living from the ACCRA web site and data is not provided for every city. Meanwhile, your actual tax rate isn't always so clear-cut, given state and city taxes, whether or not you rely on investment income, and the idiosyncrasies of individual deductions. Most importantly, the formula doesn't value the deep unhappiness someone feels when confronted with an unruly lawn on a Saturday morning after a long week at work. While economically it may make more sense for someone to mow his own lawn, from a life satisfaction perspective, hiring someone to take care of the task is priceless.

Of course, few of us can afford to outsource every chore we despise. So prioritize, starting with the tasks that devour the most psychic energy and create the most strife in your relationships. See if you can make a few tradeoffs -- in exchange for hiring the lawn guy, eat out less frequently, get your books from the library rather than the bookstore, and trim your utility bills whenever possible. Then hire the lawn guy or the cleaning lady. Despite scientific evidence to the contrary, outsourcing may do wonders for your blood pressure.