The calculated approach to outsourcing your life

One of my biggest frustrations early in my career was accepting that outsourcing tasks comes at a cost. My colleagues were always able to justify house cleaners, home-pickup dry cleaners, and handymen even as residents. Their main argument was that it helps stimulate the economy.  I understood that we should all help those around us, but I could never convince myself that anyone with a $40,000 annual residency salary truly needed a dry-cleaning pick-up service even if she was working 100 hours a week.  If I had only outsourced my chores as a resident, perhaps I would have published more papers.  I guess I’ll never know.  Did doing my own laundry cost me a career as a superstar doctor?

Fast forward to today.  I’m no longer working 100 hours a week, but 50 hours a week is still taxing.  Life evolves as we age. We get arthritis. Kids need to be shuffled to their activities. Elderly parents need medical care. Suddenly there are too many events and obligations to meet in a given day. How do we find more time?

Outsource your life.

Welcome to the world of personal assistants. TaskRabbit. You name it, you’ve got it. You pay a negotiated amount for someone else to take care of your unfinished business. Buying furniture. Putting together your furniture that they bought for you. Cleaning your house. There is almost always a price to be named for a chore that you don’t want to complete yourself.  If you have an unlimited budget, you could outsource every aspect of your life.

These feline friends know how to take life easy

As reality dictates, most of us do not have unlimited budgets.  How do you put a price on time? I generally follow these two principles:

Put a rate on the job.

What is the going rate for a chore that you’d like to outsource? How easy is it to get the job outsourced? It may actually be more difficult to outsource a job than you’d otherwise think.

For instance, two years ago my air conditioning unit stopped working. One of the capacitors broke in the unit, and the unit was mounted on the roof of my two-story house. The cost of the job was clearly over my normal pay scale as a physician, but it was not prudent to for me to risk breaking my neck from a fall on the roof. Unfortunately it was high season for the air conditioners, so the wait-time for a routine repair was 2 weeks! An emergency call would’ve cost 2.5x!

An analysis table was useful in this situation:

Advantage of outsourcing

  • Avoid fall and shock risk
  • Avoid other potential injury to unit.
  • Exchange money easily to no worry about details
  • Instant resolution of a problem

Disadvantage of outsourcing

  • Relatively expensive post-tax cost—would need to perform a roux en y surgery to cover the after-tax cost of the air conditioning repair
  • The paid help may not do a good job on the work.

I ended up paying up for the emergency repair, and all was well for one day.   Another part of the air conditioner ended up breaking (supposedly), and I ended up having the call the repairmen back.  They had to charge me another fee, stating that the second malfunctioning part was not related to the original repair!  Go figure.

Another $400 later, I was back enjoying cold air in the hot summer.  Thank goodness for having a decent paying job. The biggest sting when you have to cough up for a big ticket item is that mathematically it delays getting to financial independence. Sometimes that is the only option that you have.

Prioritize according to what gives you pleasure.

In contrast, you can cherry pick what you want to do with your time.  One of my friend’s husband, a gastroenterologist managing a relatively large practice, enjoys washing his car.  He takes call every three weeks, has limited time for the family yet he spends a few hours every month washing and waxing his car. Is that time well spent?

In a purely time per cost model, he should be outsourcing his car washes. In fact as a highly paid physician, he should actually outsource essentially every task that costs less than what he could generate from his profession if money were the only goal. There are two problems with this logic:

  1.  In order to make a direct financial comparison, he would need the ability to generate income from his profession while his car is getting washed elsewhere.  Good luck finding a way to match that up. At best, he could generate income through taking more call or working more during the workweek. However, that still doesn’t confer a perfect 1:1 exchange of time for money.
  2. Your day job may actually be mentally taxing, even if it confers a great pay rate.  How much mental and physical energy does take to do the day job instead of washing a car? What if every additional weekend you work confers a week of shorter lifespan?  What is the price you can place on your health?

Clearly this gastroenterologist has decided that washing his own car provides enough enjoyment that he chooses not to outsource the task. There is nothing wrong with that.

How do you decide to outsource your life?

Do you want to get the latest Smart Money MD posts in you inbox?
Get the FREE Smart Money MD Financial Cheatsheet for signing up!