Cost of Dying

For most exchanges, the math is relatively simple. If you get something you value more than what you give up, the deal is good for you. If the other person values what you give them more than what they give you, it’s a good deal for them. And if it’s a good deal for both of you, an exchange happens and you both win. That’s the whole story – if you value a cup of coffee more than two dollars, then you buy it from the guy who values two dollars more than the cup of coffee he’s selling. Win/win.

That math holds up well for individual exchanges. Points in time. But new factors are introduced when you start talking about exchanges that extend over long periods of time.

Time isn’t just an input unit; all time is also some fraction of your entire existence. Consider: would you spend a year away from your home, family, and friends for a million dollars? You might – I feel pretty confident that I would! Returning with a million dollars would be great, certainly a major boon for all the time after. But would I spend ten years away for ten million? Almost certainly not. And I definitely wouldn’t spend fifty years away for fifty million dollars.

But why not? If a year is worth a million dollars to me, why doesn’t that scale? Because “one year” is more than just an input. It’s also a fraction of my total life – and my total life with my children. Ten years is the majority of their childhood, and I would miss it. Trading time for money is much easier than trading money for time. No matter how much money I made, what would be the point if I had to give up the thing I care most about? Even a year would be painful, but the potential payoff in terms of the quality improvements in the remaining years might (might!) make it worth it, because a year is still only just over 5% of their childhood and (hopefully) between only 1-2% of my life.

When you consider time as a fraction of a very finite and non-renewable resource, you then introduce a sort of friction on all non-instantaneous exchanges. You create stress. And you have to factor that in when deciding whether an exchange is worth continuing.

This is why people can get burnt out of jobs that they initially thought were good trades. Let me show you this in a different way, with a different question:

Which is worth more to you: 20% of your life, or 25% of your life?

The answer is straightforward: 25% of your life must naturally be worth more than 20%. But think about what that means: each year that passes, “one year” represents a greater percentage of your remaining life! It’s not a raw input, because its value changes as long as we’re measuring its value as a fraction of your limited pool. So you agreed to a job paying $75k/year. Let’s assume simple math and say you took this job at 30, and you’d live to be 80. So when you took this job, you took it at a rate of $75,000 for 2% of your remaining life. But the next year, at 31, you’re now trading $75,000 for 2.04% of your remaining life. It might be barely noticeable over one year, but the trade is getting worse. You might ask for cost-of-living increases to cover inflation, but what about cost-of-dying increases to cover the increasing value of what you’re giving up?

Always be careful of the long-term consequences of your exchanges. Things evolve and erode; the path of time is bumpy. Don’t fall into the pattern trap of thinking that every year is the same. Last year wasn’t and next year won’t be, and eventually every one of us has a Last Year. Make sure you get good value for it.