The Best Investments You Can and Should Make

We all agree that time is more valuable than money.

At least, that’s what we say.

Then we turn around and spend hours watching bad TV we’re not even that interested in. Or 45 minutes on the phone with customer service fighting a $5 charge. Or years in a relationship or friendship we stopped feeling fulfilled by long ago.

But I’m convinced it’s not for a lack of good intent that we often end up treating time as our most fungible asset. (Hey, there’s plenty more where that came from, right? Well, not really … ) I think we simply get too busy to think about it, or don’t think we have the resources to make more time in our lives. We do have the resources, though. All it takes is a fresh look at how we really spend our days, hours and moments.

I’ve been thinking about time as a tangible asset not unlike money in many ways, and about ways to invest our time to yield higher returns—better memories, more hours well spent, even minutes that nourish us instead of fly by. After much research, experience and reflection, below are what I found to be the seven best investments you can make with your time. Think of these as blue-chip time investments that can’t go wrong—and that will yield high dividends for a more fulfilled life.

1. Invest in “Life-Extending” Time 

Investing time in caring for your health is an obvious one that will certainly yield you more time, literally—in days, months, if not years tacked on to your life. Yet we often take our health for granted until we experience a wake-up call. Proactively invest your time in your health by eating well, exercising regularly, getting plenty of sleep and regularly seeing your doctors. Invest heartily in those non-physical markers of well-being as well: emotional, mental and spiritual health—you will reap many hours of well-lived life from them. Learn the habits of the Blue Zonepeople, from the regions in the world where people live the longest. Some common lifestyle traits they share? Building in natural movement and activity, lowering stress and being part of a faith-based community.

2. Invest in “Foundation-Building” Time 

There’s a little saying that goes, “A stitch in time saves nine.” Create the time to make the right stitches, and you’ll be spared much time, hassle (and usually expense) later. Stephen Covey refers to this concept in “The 7 Habits of Highly Effective People.” According to him, we spend our time primarily on four types of activity:

• (1) urgent and important (crisis, deadlines, putting out fires)

• (2) non-urgent and important (building relationships, identifying opportunities, prevention, planning)

• (3) urgent and non-important (interruptions, phone calls, meetings)

• (4) non-urgent and non-important (TV, email, time wasters)

Covey says that we spend most of our time in sections (1) and (4), but the real area of personal growth is in (2). If you’re spending more time putting out fires than building the right foundations, you’ll never get out ahead of your to-do list.

3. Invest in “Do-Nothing” Time 

Americans could use a little dose of “La Dolce Far Niente,” or “the sweetness of doing nothing,” something the Italians and many other cultures have mastered. In America, we don’t feel our time is well spent unless we’re either producing or consuming, says social psychologist Robert V. Levine, author of “A Geography of Time: On Tempo, Culture, and the Pace of Life,” which is a limited (and frankly, stressful) perspective. In other parts of the world, such as India, it’s normal for people to enjoy each others’ company without activity or even conversation. Investing in do-nothing time will help us slow down and experience a different pace of life, in which time’s value is not measured by its productivity.

4. Invest in “System-Creating” Time 

It’s well-established in happiness psychology research that making small improvements to your life pays out exponentially in happiness. For example, putting a keyhook by the door so that you don’t spend five minutes every morning hunting for your keys. Or rearranging your closet so you can actually see everything, and not spend 20 minutes each morning figuring out what to wear. Or coming up with a better filing system for your digital photos, or your expenses (check out LearnVest’s My Money Center), so your personal admin time can be cut in half. Investing some up-front time in creating better, more organized systems will reap you lots of time in the long run.

5. Invest in “Cushion” Time 

This is one of those time investments that’s so simple, but can yield such great results in your life. In the famous “Good Samaritan” study from Princeton University in 1973, researchers John M. Darley and C. Daniel Batson put an injured person in the path of several groups of people, to see who would stop and help: those running late, those who had just enough time, and those with plenty of time to get to their destination. They also controlled for people’s religious affiliation. The results: religious affiliation had no impact on whether the individual stopped to help the person—but whether the person was in a hurry had a huge impact. Only 10% of those in a big hurry stopped to help the person, 45% of those in a medium hurry did—but 63% of those not rushed at all stopped to help. This means that being in a rush may be preventing you from being the kind of person you want to be—the kind to stop and help someone in need. Building in lots of cushion time in your schedule and preventing “constant hurriedness syndrome” is a great investment in yourself and in the quality of life of those around you.

6. Invest in “Savoring” Time 

A recent 2010 study published in the Association for Psychological Science found that wealthy people are unhappier because they have a lower “savoring ability” (the ability to enhance and prolong positive emotional experience), like taking in the colors of a sunset or the taste of a cold beer. Apparently, having access to the best things in life may actually undermine your ability to reap enjoyment from life’s small pleasures. It’s not a coincidence that savoring requires slowing down—taking a few extra seconds to really look at the colors of the leaves, or munching slowly to enjoy the texture of a bite. Investing time in savoring all the unique sensorial moments of your day will guarantee your moments don’t flash by in a dull blur.

7. Invest in “Time Assessment” Time 

You wouldn’t keep spending or investing money without assessing how well things were going every month, quarter or year, and the same thing should apply to your time. How frequently you decide to take stock is up to you—but a good system might be:

• Five minutes a day to make sure you’ve invested time in at least one thing on this list

• 15 minutes a week to review your past week’s schedule and what you wish you had made time for, and what time investment made you happiest

• One hour a month (or two to three hours a season) of quiet time with a journal to assess the past season, how your time felt and how you’d like to invest your time in the coming season—this can pair nicely with the tempo of the period. For example, holidays may mean more family investment time, the new year can be career-focused, summertime may have a big leisure time component, etc.

• One day a year of time alone or with a friend or partner (best if you can physically go somewhere peaceful and different from your daily routine), assessing the past year and where your times and energies went, setting goals for the new year, and whether you are closer to achieving what is truly important to you in life

Stock Up: Investing for Beginners

Think the stock market is just for bigwigs? Guess again. Truth is, with stock prices at a major low, this is a great time for market newbies to get in on the action.

Step 1: Analyze Your Accounts

Do you have money to invest? The cash you put into the stock market should be money you can afford to lose. Look at your budget and see how much is left over after housing, transportation, emergency fund padding, and your retirement savings -- stocks shouldn’t replace your 401(k) or IRA. Decide what chunk of that balance you can afford to put into the market, whether it’s $100 or $2,000.

Step 2: Buy What You Know

One of the first questions new investors often ask is: “How do I know what to buy?” Well, you can make money buying the brands you know best. Think of it this way: If you’re really into cycling, you know way more than the average person about which bikes are hot right now or the new products that are coming out. Use the knowledge you already have to make smart investments.

Step 3: Check out Big Brands

If you want to start with a safe, steady stock, major brands like Walmart, McDonald’s, and Disney (just to name a few) are solid options. With the economy in the tank, you can now buy shares for as much as 40 percent lower than they’ve gone for in the past, making it easier than ever to invest without breaking the bank. The trick is to buy low now and sell high later. Also check out Morningstar.com to see the top-rated funds.

Step 4: Test Your Skills

Before dishing dollars into the market, go to Investopedia.com and Marketocracy.com for tips and advice in a language that’s easy to understand. Another great resource is WeSeed.com, which allows you to create a portfolio using fake money. You can “buy” stocks in your area of expertise, see how your investments would do in the real market, and get comfortable with how stocks work before investing with real dough.

Step 5: Talk to People

Ask friends, family, and coworkers to weigh in on companies and products you’re thinking of investing in, and feel free to dish on the brands you know best. You can also check out Facebook, investment clubs, and our Money Matters message board.

How to Withhold the Right Amount From Your Paycheck

Great questions. Let me start by saying this: If you want to build a secure financial future for you and your spouse, you absolutely must Pay Yourself First. Paying Yourself First means putting aside a set percentage of every dollar you earn and investing it for your future in a pretax retirement account, like a 401(k) plan.

How much should you Pay Yourself First? Here’s a simple rule of thumb: To be fair to yourself and your future, you should aim to Pay Yourself First at least one hour’s worth of income every day -- which works out to be about 12.5 percent of your gross income.

Paying yourself back for an hour a day makes a lot of sense if you start relatively young -- let’s say 25 or 30. But the number-one thing you can do to ensure a richer retirement is to max out your plan. In other words, commit to making the maximum contribution allowed. This year, the maximum 401(k) contribution allowed by the IRS is $16,500.

Only you and your partner can determine what your personal goals are when it comes to saving for retirement. How much should you save? The realistic answer is: as much as you can. There’s no better time than right now to start saving for your future. So make the decision today to start Paying Yourself First. Enroll in your plan. If you’re already enrolled, increase your contributions. If your company doesn’t offer a 401(k) plan, set up an Individual Retirement Account (IRA) instead.

Sneaky Ways to Save Some Serious Cash

Forget Fives

If using cash, at the end of the day, empty your wallet. See any five-dollar bills? Nab 'em and put 'em in an envelope. Do this every day, and at the end of the month, deposit the bills into a savings account. You'll be putting money you would have spent on other things into savings, and you'll trick your brain into making it part of your daily routine. You'd be surprised how quickly it all adds up.

Spend Money to Save Money

Jean Chatzky, financial expert and author of Money Rules: The Simple Path to Lifelong Security, says that sometimes, it saves to pay. "I know it sounds untraditional, but I was a victim of the $30 blowout (once a week, sometimes twice) until I spent nearly $200 on a really good flat iron," she says. "Now I still go for special occasions, but it saved me at least $1,500, and probably more like $2,000, a year." Is there something that you splurge on that you can cut down? Try investing in favorite coffee to make at home, an awesome topcoat for your DIY mani, or an ice-pop maker to make your own frozen (cheap) treats.

Hide the Money (From Yourself)

The reason 401(k) plans work is explained in Chatzky's money rule: If you can't see it and you can't touch it, you won't spend it, she says. Automatically transferring money from checking into savings, an IRA, a 529 Plan, or even an account with a different bank where you get a slightly higher rate of interest (think online banks like ING) works spectacularly.

Grocery Shop Online

It's harder to avoid those impulse buys when you're seeing it on the shelf (and when you know you can dig into that cupcake soon). "That's why I'm now an online grocery shopping devotee," says Chatzky. You save money because you don't buy on impulse, and you can save gas to boot. Plus, many online services store your list, so you can get all your basics in one click (saving you time). Even with the $5 to $10 delivery fee, "I more than make up for it," says Chatzky.

Transfer Balances

If you have a credit card that seems to be killing you with fees, here's what to do: Call customer service and ask to lower your interest rate. If they say no, speak to a supervisor. And if that supervisor says no, speak to his or her supervisor. If you still hit a dead end, look for a cheaper card to transfer your balance to (hint: go to lowcards.com to find one). "But don't close the old card unless the annual fee is ridiculous, advises Chatzky. "Closing it will take your credit score down."