Aspirational Hourly Rate

"Set and enforce an aspirational personal hourly rate. If fixing a problem will save less than your hourly rate, ignore it. If outsourcing a task will cost less than your hourly rate, outsource it."

How to pick the rate

• "Fast-forward to your wealthy self and pick some intermediate hourly rate."
• Naval used $5,000/hour even before he had any real money.
• "Should seem and feel absurdly high. If it doesn't, it's not high enough."
• Whatever you picked, raise it.

How to apply it

• Factor your time into every decision. "It's going to take you an hour to get across town to get something. If you value yourself at $100/hr, that's basically throwing $100 out of your pocket."
• If outsourcing costs < your rate → outsource. This includes cooking ("eat your healthy home-cooked meals — but if you can outsource it, do that instead").
• Skip arguments with electricians / returns of broken speakers. "That's not a problem that I solve."

Anchor: no one will value you more than you value yourself

"No one is going to value you more than you value yourself. You just have to set a very high personal hourly rate and stick to it."

Calibration check

• Naval looking back: thought $5,000/hr; actual achieved closer to $1,000/hr.
• He still ended up doing "stupid things" — but far less than friends.
• The rate is aspirational because its enforcement bends behaviour toward eventually earning it.

Complement

• "Earn with your mind, not your time."
• "Get rich by saving your time to make money" — not "save money by spending time."

Related

• Judgment — the rate is what your time is worth when judgment is your output.
• How to Get Rich (Without Getting Lucky) — Canonical Tweetstorm — tweet #33.

Sources: [Almanack pp36, 69-72]