The Daily Thinker

Are you in a position where you’d like a little extra income, but just can’t seem to find the time? You may have thought of getting a new job or a part-time job, or make a little extra with different options online or with passive income. In any case you probably consider your earning potential and qualifications when thinking about how you might earn additional income. Both of these generally consider your education, experience, skills, etc. When considering your earning potential, I think there is another factor to consider, which is time.

What is your earning potential with regards to time? Well, if you earn $50,000 per year, that equates to about $25 per year based on 2000 working hours. We are awake for approximately 5840 hour per year (16hrs per day). Let’s think of that in terms of one week. Let’s assume you sleep eight hours a night, which is a little generous for most of us. Then you have to get ready for work, go to work, come home, have dinner, and then…….then you have about 4hrs to spare during these weekdays and about 16 hours per day on the weekend. That adds up to 52 hrs of additional earning potential. That’s more than entire second 40 hr work week at your disposal.

I know, who wants to work those kind of hours. However, if you have the need or desire to make a little extra money, then consider this. You have the potential to make money for about 112 hours in a week. That’s not taking into account meals, preparation for work, travel, etc, so it’s actually a little less than that. The common problem is who wants to work evenings and weekends doing something you don’t like. And the other problem might be finding a second job that can work around your schedule.

It would be easier if you could turn a hobby into a revenue generator and could do this from home so you can set your own hours. Some people like knitting, making crafts, writing, etc. What if you can turn this time and effort into money?

Alternatively, you can look at using your spare time to earn money in a different way. It’s been said that a penny saved is a penny earned. What if you used some of these extra 52 hrs per week to make items for much less than you would otherwise pay. You’re not technically making money, but you will be spending less money. Some ideas could be making dinner every day, making lunches, making bread (fantastic bread making book), making cleaning products, growing your own food, etc. Or use this time to make gifts, which are items that you would probably otherwise spend more money on if not made.

So looking at your time as earning potential you might be able to identify opportunities. Whether you’re earning more money by making more or spending less, both positively affect your net income, which is what many of us are trying to do.

If you’ve found creative ways to optimize your time in an effort to increase you earning potential and net income, please drop me a line. I’d like to hear where you’ve succeeded and even where you feel you’ve failed.

Thanks,

The Daily Thinker

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I don’t know the exact inner workings of how a government manages their finances, but I would have to assume that they don’t plan on making a profit from taxes, yet they don’t plan on accumulating debt by providing service they can’t afford either. I think they plan to more or less break even by predicting revenue and expenses, and making adjustments accordingly.

Governments generally provide certain services to those living in their jurisdiction. Services such as healthcare, education, the maintenance of roads/highways, etc. They collect revenue in the form of taxes to pay for these services.

In recent years it seems that governments are being required to cut expenses in some areas, due to a shortfall of revenue and/or to accommodate an increase in expenses in other areas.

My first response is to say that this is poor planning; poor budgeting.

My second response is to consider why there’s a shortage of revenue in comparison to the increase of expenses. I would think that the increase of immigration into this country over the last fifteen to twenty years, and the increase tax revenue collected from this new workforce would make up for this shortfall. But apparently it hasn’t. (That isn’t intended to be a negative view on immigration.)

At one time in our somewhat recent past our governments were collecting enough taxes to do wonderful things, such as creating one of the best public healthcare systems in the world, a very good public education system, etc. These services were created and/or improved upon with revenue collected from the baby boomer generation, one of the most well off generations in our history (collectively well off; the wealth was spread out). One of the characteristics of that generation was the large middle class. What does that mean exactly? It means that a great percentage of our population made a good living with full-time work and paid their share of taxes.

What happened to the revenue stream that was once able to afford good government services that are now being cut? Many of those workers were forced into early retirement and most are now retired. What has replaced that workforce? Due to a loss of hundreds of thousands of middle-class jobs in this country, that workforce was replaced by low income service jobs and self-employment. Low income earners don’t pay a lot in tax and self-employed workers are able to significantly lower their taxable income. So we’ve replaced well payed middle-class earners with earners who I’ll dare to say pay significantly less tax. So, unless I’m way off base here, which I don’t think I am, the tax revenue stream that was able to support some great government services got decreased due to the loss of middle-class jobs.

I’m not an economist, but I believe that what I described in the previous paragraph has some merit. If you don’t think that it does, I’d really like to hear your opinion. I just don’t know how we can replace well paying jobs with lower taxable income jobs and expect to afford the same expenses. It just doesn’t make sense to me. Did no one see this coming?

My bigger concern is how this will get rectified without more huge cuts to our social services. And my bigger question is, will the level of services that we experienced in the 80s ever return?

Anyway, I just thought this was an interesting discussion. I’ll like to hear what you have to say on this topic.

Thanks,

The Daily Thinker

Note: This is a big topic with many variables and I could have written much more than this, but I wanted to keep the focus on taxable income as it relates to government revenue and expenses, and I wanted to keep it somewhat succinct.

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