The Invisible Price Tag: How Time Shapes Our Spending Choices

On a lazy Sunday morning, Mehak feels hungry but doesn’t want to cook or walk up to a food outlet. She opens a food delivery app and pays an extra Rs. 80 for delivery charges. Without hesitation, she places time saved and convenience over money.

Yet, when it comes to filling out a mutual fund KYC form, updating PAN–Aadhaar details, or setting up an SIP, Mehak procrastinates.

This contrast reveals a paradox in money psychology. People are often quick to spend money to save time in daily life but hesitate to spend a little time on financial tasks that could create far greater benefits in the future.

Table of contents

• Time: the hidden currency in personal finance
• Convenience now vs. long-term vision
• How time-cost bias affects saving and investing
• Behavioural finance insights: Why we delay what matters
• Why this matters for investors
• How to do a time audit

Time: the hidden currency in personal finance

Despite being a finite and valuable resource, time is often overlooked in financial decisions. Every individual has the same 24 hours each day, but how we allocate that time may influence both lifestyle choices and long-term financial outcomes.

The Time Value of Money (TVM) is a core principle in finance. It states that a sum of money today is worth more than the same sum in the future, because money can be invested to earn returns over time. The concept is built on the power of compounding — where invested money has the potential to grow as returns generate further returns.

Seen through this lens, even small delays in investing can carry a cost. An hour spent today on financial planning, such as completing paperwork or starting an SIP, may potentially unlock long-term benefits that outweigh the short-term effort.

In Mehak’s case, prioritising paperwork over postponement could have set her money to work earlier, giving compounding more years to potentially create growth.

Also Read: Financial Planning: Meaning, Benefits, Types and Objectives

Convenience now vs. long-term vision

• Food delivery apps: Paying Rs. 80 extra for delivery feels effortless, but the same amount invested regularly could grow meaningfully over time.
• Delaying tax planning: Many wait until March to make tax-saving investments, losing months of potential compounding.
• Learning and upskilling: Two hours a week spent on financial literacy or upskilling may build career and income potential, but people often put it off either because of the time it takes or the money the course requires.

How time-cost bias affects saving and investing

• Delayed investing: Postponing SIP or paperwork reduces the years available for compounding. For example, let’s compare two scenarios using a simple SIP calculator (assuming a 12% annualised return, purely for illustration):

• Investor A starts at age 25, investing Rs. 5,000 monthly until the age of 55 (30 years). Potential corpus ≈ Rs. 1.76 crore.
• Investor B delays and starts at age 35, investing Rs. 10,000 monthly until age 55 (20 years). Potential corpus ≈ Rs. 98 lakh.

Even though Investor B invests twice the amount each month, their final corpus is still smaller because they lost 10 years of compounding.

Note: The calculator is an aid, not a prediction tool. It may provide only an indicative picture.

• Procrastination in retirement planning: Treating retirement as “far away” delays action, creating more stress later.
• Ignoring opportunity: Leaving money idle in a savings account instead of investing in higher-return avenues means missing out on potential growth.

Behavioural finance insights: Why we delay what matters

Behavioural finance studies show that people often make decisions based on psychological biases rather than pure logic. The paradox of paying for convenience but procrastinating on financial tasks reflects a few well-known biases:

• Present bias (or hyperbolic discounting): We place more value on immediate comfort (like food delivery) than on future benefits (like SIP paperwork).
• Procrastination and mental accounting: Small financial tasks like KYC or SIP setup are mentally filed as “chores” rather than “investments of time,” leading to delays. Meanwhile, money spent on delivery is mentally filed under “convenience,” making it feel justifiable.
• Opportunity Cost Neglect: People rarely think about the foregone benefits of delayed investing. In the SIP example, the lost 10 years of compounding is the invisible opportunity cost of procrastination.

Read Also: How Money Narratives Shape Financial Decisions

Why this matters for investors

Understanding these behavioural tendencies can help individuals reframe how they see time:

• Treat financial tasks (paperwork, planning, reviews) as time investments with potential long-term returns.
• Recognise when present bias is steering decisions, and introduce small nudges — reminders, auto-SIPs, or apps — to counter procrastination.
• Conduct a time audit to make the invisible cost of delay visible.

How to do a time audit

A time audit may help individuals be more aware and intentional with their decisions. A time audit helps reveal where hours actually go and whether they align with long-term goals.

How to do it:

• Track weekly hours spent commuting, scrolling social media, or binge-watching.
• Compare with hours spent on financial planning, health, or learning.
• Reframe tasks like KYC, reviews, and budgeting as investments of time with long-term payoffs.
• Paying for convenience isn’t inherently wrong — but balance it by also investing time in future-oriented activities.
• Use digital tools (e-KYC, SIP e-mandates, apps) to reduce friction and make time investments easier.

Also Read: Present Bias in Finance: Choosing Today Over Tomorrow

Conclusion

The invisible price tag of time is easy to miss. We don’t blink at paying for convenience today, but often delay the small time investments that could secure our financial future. The lesson is not to avoid convenience, but to recognise the paradox and strike a balance: spend money to save time where it matters — and spend time where it can shape tomorrow.

At Bajaj Finserv AMC, we recognise that emotions are the cornerstone of investor behaviour – not just for investors but for investment professionals too. That’s why, behavioural finance is at the heart of our investment philosophy, InQuBe, which combines the Information Edge, Quantitative Edge and Behavioural Edge. By understanding, tracking and monitoring market sentiments and our own investment biases, we seek to make mindful and strategic investment decisions. Get the Behavioural edge by investing with Bajaj Finserv AMC. Read more about InQuBe here.

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