Last week I came across a concept called time billionaire. In the context of FIRE, this has stuck in my mind. I have been a FIRE enthusiast over the last 5 years and this idea helped me put things into perspective. The goal of this article is to show you the tradeoff between time and money.
The life expectancy of a normal healthy adult is around 80 years.
A billion seconds almost equals to 31 years. So on average every 20 year old has 2 billion seconds of time left. We work hard, spend our time to earn money, save our money to buy capital. The capital appreciates over time and gives us money. That is how we convert our time into money.
Taking the returns of the US stock market over the last 100 years and assuming it doubles every 10 years, earning the capital early in life pays dividends in terms of that capital will give more money and time back to the owner to enjoy.
Hence, 1 million USD earned at 30, will be 8 million by 60, if the owner doesn't need to depend on that capital for day to day expenses. As this post calls out, there are different brackets of numbers and where each individual lies in the bracket is a deeply personal question and the answer will vary based on lifestyle and choices. But the point is the faster you get there, the more you time you have from life.
This point can be really driven home by this following question :
If you got a chance to exchange your position with Warren Buffet today, would you do it ? You would be both the richest person on earth and also be 90+ and wont have long enough to live from hereon.
For folks, for whom the answer is No, you already have the most valuable resource on earth which is time. Use it wisely and you can generate both time and money.
