Why ROTI Is Important For You

Does money have value? Apparently it does and it’s based on all on time. 

We keep talking about the time value of money (TVM), which is such an important concept in finance. TVM is used to discount future cash flows to present value. It’s widely used in the valuation (and hence the management) of almost any financial or real asset from shares to bonds to property. It’s frequently used at numerous companies daily to decide whether to go ahead with a project or not. Etc. etc. 

TVM is such an essential, pervasive, basic concept in finance that any student of finance would know it. 

We also hear a lot about Return on Investment (RoI) and everyone and his uncle are trying hard to max the RoI on their cash. 

But, what about the value of time and the concept of Return on Time Invested (ROTI)?? 

Unlike money, time is finite and hence automatically and immensely more valuable. You can use it not just to make money but for many other activities. Every passing day is a day you’ll never get back. Every passing day brings you closer to death. There are things you can do when you’re younger that you can’t do or do with great difficulty when you’re older. Opportunities come and go and never return. Etc.

But we don’t hear anyone talking about the value of time like they talk about TVM do we? No one moans about the value of the 2 hours he lost yesterday or the 20 minutes he wasted this morning. 

Is it because you can’t buy or sell time? Or because it’s so hard to measure the value of time because you can do many things or anything or nothing with time? I don’t know. 

Similarly no one talks about ROTI. Yes, time management is popular but that’s not the same. 

The results of this simultaneous obsession with money and indifference to time are clear and disastrous. People chase and hoard money but ignore and squander time. They’ve got things badly mixed up and that’s a huge pity. 

You see the effects of this shocking ignorance of the value of time and of ROTI all around you. 

People hesitate to start important personal projects, giving out a million excuses. They burn time being perfectionists when there was absolutely no need. They waste time in crap jobs and toxic relationships. They keep saying ‘YES’ when they should be saying ‘NO’ and they take on irrelevant responsibilities. They learn too late (and apply even later!). Overall their ROTI is so low or even negative but they’re blissfully unaware and unconcerned. 

I used to be one of those people. 

But these days ROTI drives many things I do. ROTI in my world largely means making an impact while having fun and being free. Hence, my days are filled with activities that I hope deliver a decent ROTI. 

I read a lot. I talk to friends. I work on my RFM podcast, blog pieces etc. I try to inspire on social media specifically LinkedIn and Instagram. I am very active as a volunteer board member with CFA Emirates Society. I mentor selectively. I work out regularly. I constantly find out ways of eating healthier. 

I don’t do useless coffee meetings or phone calls. I don’t allow free riders. I’ve deleted all the toxic relationships in my life. I don’t mentor people who I suspect lack the ability and the right attitude. I don’t overthink. I delegate a lot. I’ve given up my tendency to be a control freak and a perfectionist. I’ve absolutely no qualms in saying ‘No’ and I say that a lot. I quickly come to the point and don’t waste time dancing around issues. 

I could go on. 

It’s not easy because you first need to be absolutely clear what your priorities are. Then you need to be ruthless about it. 

ROTI. Because life will never return.