How Much is a Dollar Worth?

I · December 5, 2020

I try to get most of my stuff used from online marketplaces like Craigslist or Kijiji. One problem I have with trying to make offers is that I have to decide how much a certain item is worth to me. I feel pretty lost here. I might know how much other people are charging for similar items (its market value) but what does that have to do with how much something is worth to me? For example, Champagne certainly isn’t worth its market price to me.

Money’s value is determined by what one can trade it for. Thus, I figure to make it easier to know how much something is worth to me, I could try to get a better idea of what else that money could be traded for. I can think of three general things one might trade money for:

  1. Goods and services
  2. One’s time
  3. More money in the future

By figuring out the going rate for items in these categories, I can work backwards and try to figure out how much something is worth to me by how I value it compared to other things I could spend the money on, the amount of time I would have to work to earn that much money, or future income that that money could produce if invested instead of spent. I’m going to use prices from my area in my currency (Canadian dollars), but hopefully you will also be able to use my findings to better determine the value of your prospective purchases.

Goods and Services

A good or service that will be useful for comparisons will ideally have certain characteristics:

  • The price can easily be found out
  • The price is relatively stable across time

In order to be useful for more people than just me, a good/service should also ideally have these characteristics:

  • The price is relatively constant across geography
  • Most people find it valuable

Not all of these meet the conditions above, but here are some ideas:

  • Staple foods
    • 1kg of white rice: $3.75
    • A dozen eggs: $3.46
    • A loaf of bread: $2.89
  • Bar of soap: $0.40 (from a 10-pack) (Amazon Canada)
  • A tampon: $0.22 (from 50 pack) (Amazon Canada)
  • Weight plates: about $2/lb according to my local Kijiji
  • A Big Mac: $5.49 at my local McDonalds
  • Public transit fare: $3.25 (TTC in Toronto)
  • A cheap bicycle: $200 (based on my local Canadian Tire)
  • A cheap motel room: $75 (local)
  • A reliable, cost-effective car: $19,150 for a brand-new current model Toyota Corolla (disclaimer: I know nothing about cars)
  • A month of unlimited-data internet service: $77.49
  • 1 prepaid cell phone minute: $0.32
  • The cheapest available cell phone at BestBuy: $60
  • A current generation iPhone: $979 for the base model iPhone 12. (Apple website)
  • A kilowatt-hour of electricity: $0.15 (mid-peak rate, local)
  • Estimated cost to save a life by donating to the most effective charities: $4000 - $6500 (based on Givewell’s research)

(Prices are Canadian averages according to unless otherwise indicated. Doesn’t include sales tax. Some of these items, such as staple foods, would not be subject to sales tax where I live. Otherwise, sales tax is 13%.)

Now we can use this information to think about various amounts of money in more tangible terms.

$20 is:

  • 5.3kg of white rice (almost 12 lbs) (19,345 calories (almost 10 days worth of (nutritionally incomplete) food))
  • almost 70 eggs (5460 calories, 420 grams of protein)
  • almost 7 loaves of bread (11,183 calories (over 5 days worth of food))
  • 50 bars of soap
  • almost 91 tampons
  • 10 lbs of weight plates
  • about 3 and a half Big Macs (3 Big Macs and a McDouble) (about a days worth of calories)
  • over 5 public transit trips
  • one tenth of a cheap bike
  • a little over a quarter of a night in a cheap motel
  • 0.1% of a new Toyota Corolla
  • about 8 days of internet access
  • a little over an hour of talking on a cell phone
  • 1/3 of a really cheap cell phone
  • 1/50 of an iPhone
  • 133 kWh of electricity (about 81 days of running my fridge)
  • 0.3% - 0.5% of a saved life

$500 is:

  • 133kg or white rice (483,625 calories (food for 241 days (almost 8 months)))
  • 1734 eggs (135,252 calories, 10,404 grams of protein)
  • 173 loaves of bread (279,568 calories (139 days of food))
  • 1250 bars of soap
  • 2272 tampons
  • 250 lbs of weight plates
  • 91 Big Macs (over 25 days worth of calories)
  • almost 154 public transit trips
  • a couple cheap bikes
  • 6 and a third nights in a cheap motel
  • 2.6% of a new Toyota Corolla
  • over 6 months of internet access
  • 26 hours of talking on a cell phone
  • 8 and a bit really cheap cell phones
  • half an iPhone
  • 3,333 kWh of electricity (over 5 years of running my fridge)
  • 7.7% - 12.5% of a saved life

One’s Time

This one will be unique to each person, at least insofar as one measures the value of one’s time by how much one is able to trade it for by working for pay.

The book Your Money or Your Life by Vicki Robin and Joe Dominguez encourages readers to calculate their “true hourly wage” as a way to determine the true value of their money. This factors in all the time and money one spends in a way that they would have chosen to spend differently if they didn’t have a job. This means you need to include, for example, commuting time and costs as well as de-stressing time and costs in addition to hours worked and money received. After calculating this true hourly wage, you can find whether a purchase is really worthwhile to you by asking yourself whether you’d be willing to work for however many hours extra at your true hourly wage it would take in order to pay for that purchase.

Now, it’s possible that you feel you’re getting a pretty good deal for your time, and you’d be willing to work for less. It’s also possible that you like your job, and so you don’t fully consider it to be selling your time. These are valid points that should be kept in mind, but they complicate things too much to be factored in here.

I will calculate the “true hourly wage” for someone who has a half-hour each way walking (i.e. free) commute and works full-time at minimum wage where I live ($14). I encourage you to do the calculations for your own situation. This will allow you to think about the cost of an item in terms of how long you would need to work to afford the item.

Hours per week: 40 (job) + 5 (commute) = 45 Income per week: $560 Income per week after tax: $459 True hourly wage: $459/45 = $10.20

Time to work to afford something that costs $20: 1 hour 58 minutes Time to work to afford something that costs $100: 9 hours 48 minutes Time to work to afford something that costs $500: 49 hours 1 minute (a little over 5 days on the job) Time to work to afford something that costs $5000: 490 hours 12 minutes (almost 3 months (over 54 working days))

Now someone with the same commute who makes $60,000 / year with 15 days paid vacation (I think this salary is slightly above the median): Working days: 235 Hours per day: 8 (job) + 1 (commute) = 9 Hours per year: 2115 Salary: $60,000 Salary after tax: $45,527 True hourly wage: $45,527 / 2115 = $21.53

Time to work to afford something that costs $20: 56 minutes Time to work to afford something that costs $100: 4 hours 39 minutes Time to work to afford something that costs $500: 23 hours 14 minutes Time to work to afford something that costs $5000: 232 hours 15 minutes (over a months (almost 26 working days))

More Money in the Future

By investing money, it is possible to turn money now into future income. With an idea of what rate of return you can get on your money, you can ask, “Would I rather have this item or $x/year for the rest of my life?”

This relies on having some sense of how much $x/year is worth, but that can be done using the methods above.

Some possible rates of return to use:

  • The current rate for 30-year US treasury bonds (1.58% before inflation. This is pretty low historically as far as I know)
    • 4% after inflation (the “safe withdrawal rate” based on the Trinity study
  • 7% after inflation (my understanding of the average performance of the S&P 500 throughout history)
  • Whatever you think you can get, o skilled investor

To make these numbers a bit more real, we can look at how much income $20, $100, $500, and $5000 can bring in at 1.58%, 4% after inflation, and 7% after inflation.

$20 gets you:

  • $0.32/year before inflation, $0.03/month before inflation
  • $0.80/year, $0.07/month
  • $1.40/year, $0.12/month

$100 gets you:

  • $1.58/year before inflation, $0.13/month before inflation
  • $4.00/year, $0.33/month
  • $7.00/year, $0.58/month

$500 gets you:

  • $7.90/year before inflation, $0.66/month before inflation
  • $20/year, $1.67/month
  • $35/year, $2.92/month

$5000 gets you:

  • $79/year before inflation, $6.58/month before inflation
  • $200/year, $16.67/month
  • $350/year, $29.17/month

$100,000 gets you:

  • $1580/year before inflation, $131.67/month before inflation
  • $4000/year, $333.33/month
  • $7000/year, $583.33/month


A Big Mac every day for the rest of your life costs $50,130.56 today.

If you have $120 and use a bar of soap per month, you theoretically have soap for life.

Minimum wage where I live is only slightly more than half a cell minute per minute.

Rice is 15% cheaper per pound than whatever weight plates are made of.

McDonalds may be cheap as far as restaurants go, but you can eat for much, much cheaper if you like rice and eggs.

Taking a bar of soap home from a hotel room recoups 1/187 of the cost of a stay (if you’re staying in a cheap motel).


These methods don’t fully solve my problem of trying to figure out how much money things are worth or how many things money is worth. A lot of simplifying assumptions also have to be made during the process of trying to calculate the value of one’s time or one’s expected investment returns. However, I think that knowing some of these numbers should make my valuations a little bit more accurate, and hopefully it’s the same for you.

What you think? Is there anything I left out? Do you have your own trick to determine how much things are worth to you? Let me know in the comments.

Twitter, Facebook