When it comes to working, we always start with a limit of 24 hours per day. We can use these hours for work or leisure and, by extension, for income and spending. An hour of leisure always costs an hour of our time. But how much does $1 of income cost? It depends on your hourly rate. 

At $20 an hour, $1 of income costs three minutes of your time. At $200 an hour, $1 of income costs just eighteen seconds. The higher your hourly rate, the less time you need to work for each dollar. Essentially, the price goes down. 

This makes you better off, but it’s not obvious how your behavior will change. In general, people tend to buy more of things whose prices fall and less of other things. So if your income’s price in terms of your time drops, you might work more—it’s as though income is on sale, and you’re buying in bulk! Then you’ll devote less time to other activities, like studying for a degree, cleaning your home, or watching television. Seen another way, the opportunity cost of doing any of those things has increased. 

But the falling price of income also means you could buy more of both income and leisure than you did before. Miraculously, those same twenty-four hours now allow you to earn more income and take more leisure—by working less! So which effect dominates? Do you work more or less? Even if you’re required to put in 35 or 40 hours each week, do you go the extra mile with overtime, or do you use every single one of your personal days? 

Early in their careers, lots of people do work more as their hourly rates rise. But eventually, after many years of rising wages, they find that they can buy all the things they want even if they pare back their time at work. Their hourly rates get so high that leisure, not money, becomes the scarcer commodity. So they end up choosing to work less. 

The decision to work less can also be a natural consequence of a certain way of thinking. If your goal isn’t to maximize your wealth, but rather just to make enough income to buy the things you want, then you’ll stop working once you reach that target. To borrow a popular turn of phrase, it’s the difference between living to work and working to live. 

But these decisions about working don’t always work out as planned. In a recent survey covering workers in Europe and the United States, 59 percent said they should have done a better job balancing work and leisure.

How does this happen? Sometimes it’s just bad luck. Other times, people know they ought to do something—and even say they’ll do it—but they still don’t. And this is where economists get involved. 

My favorite example of this problem is your alarm clock. Let’s say you go to bed every night at 10:00 p.m. after setting your alarm for 6:00 a.m. Then, when 6:00 a.m. comes and the alarm goes off, you hit the snooze button a couple of times. After a few more minutes of disrupted dozing, you eventually roll out of bed at 6:18 a.m. (if you still have an archaic nine-minute snooze). Looking back, you would have been better off setting your alarm for 6:18 a.m. and sleeping all the way through. So why didn’t you? 

The answer is dynamic inconsistency. Your ten-o’clock-last night self had different preferences from your six-o’clock-this morning self. The first version of you really did want to wake up at 6:00 a.m. and face the day! But the version that actually woke up at 6:00 a.m. didn’t agree.

The same thing can happen with work. Maybe you love your job and chalk up a ton of hours, spending less and less time with your friends, partner, and kids. Then, your 60-year-old self isn’t happy with the choices your younger selves made.This could happen for a couple of  reasons, one of which might be pure chance. But maybe, in the  back of your mind, you knew you should be spending more time  with your friends, your partner, and your kids. Yet somehow you let yourself be drawn into working more hours. If you’re conscious of the problem during your younger years, you might be able to commit yourself to working less by scheduling  regular activities with friends and family—and even setting penal ties for missing them. You might also make a habit of booking your vacations far in advance.

When you’re on the job, you might want to create a few cues to remind yourself when working hours are over—an alarm on your smartphone, a reminder on your computer, or a timer on the lights in your home office. But what if you’re not aware of the problem at allIn essence, you’re asking your younger self to both predict and adopt your 60-year-old self ’s preferences.  

One way to address this problem is simply to spend more time thinking about what you’d like your life to be like when you’re older. A conscious and deliberate exercise can build empathy with your future self.The last factor to consider is timing. So far, we’ve assumed that the opportunity cost—that is, the well-being generated by leisure— stays constant. Yet this cost could be particularly high at certain times of your life, such as when your kids are young. In that case, you’d want to work less so you could have more time with them during their formative (and exceedingly cute) early years. 

Timing may also matter depending on how you spend. If you’re trying to buy a durable good that will offer benefits for many years to come, then you might want to work more so you can make the purchase as soon as possible. But if you’re just paying for the usual necessities—food, clothing, rent, utilities—then there might not be any particular urgency. 

Of course, all of this could change if, say, you’ve got a hole in your retirement savings or you happen to win the lottery. Here are Altman’s tips for the best decisions: 

• Understand that you use time to purchase both leisure and income, so your task is to choose the optimal mix. 
• Ask whether you’re targeting a set level of spending or trying to earn as much as you can, since these objectives will lead to different outcomes. 
• Think about what your future selves will be like and what they will want for the later years of your life. 
• Consider how the timing of your work relates to its opportunity cost and your spending plans. 
• If necessary (and possible), use what you learn to create rules and a working environment that will help you to overcome dynamic inconsistency. 

Excerpted from THE BEST DECISIONS YOU’LL EVER MAKE by Daniel Altman. Copyright © 2026 by Daniel Altman. Published in the United States by Crown Currency, an imprint of the Crown Publishing Group, a division of Penguin Random House LLC.