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The ROI of a Virtual Assistant

The most common objection people give to hiring a virtual assistant (VA) is “I can’t afford it.” For some, this is true. They lack the funds for this service or the time to train a VA up to the point of being useful.


For most people, though, the opposite is true: A well-trained virtual assistant can help you earn more money every month and free up your time. Virtual assistants perform administrative and communications tasks so you can spend more time doing enjoyable things.

Which kind of person are you? Can you honestly not afford a virtual assistant, or will a VA improve your income and quality of life? Running a return on investment (ROI) analysis on the prospect is one of the best ways to find out.

What Is ROI?

Return on investment is a specific equation used by business planners to determine whether something is profitable enough to spend resources on it. It’s expressed as a formula:

ROI = Return ÷ Cost 

Return is how much money the investment will make, while cost is how much money you’ll spend on the investment. You can express the answer as a whole number or a percentage.

For example, if a lemonade stand costs $10 and brings in $15, your ROI would be 1.5 (15/10), or 150%. If you bought a collectible train set on eBay for $800, spent $200 on restoring and advertising it, and earned $1,200 on the resale, your ROI would be 1.2 (1,200/100), or 150%.

If your ROI is higher than 1 or 100%, the investment is profitable. The higher your ROI is, the more worth the initial investment it becomes. If it’s 1 or lower, then you’ll break even at best and it’s a bad move.

The Time ROI of a Virtual Assistant

Although most people think of money first when considering return on investment, when it comes to hiring a virtual assistant, it’s easier to calculate the ROI of time. In this case, you would compare the amount of time a VA would require for training and instruction, then divide that by the amount of time the VA would save you.

For example, if you found eight hours per week of tasks for your virtual assistant, and that assistant required one hour per week of instruction and management, then your time ROI would be 8 (8/1), or 800%. Provided you could afford the eight hours of salary, that’s a significant return on investment.

On the other hand, a substandard VA given two hours of work per week, who required an hour of explicit instruction and caused an hour’s worth of mistakes, would have an ROI of 1 (2/2), or 100%. You would break even after spending the money. Such an assistant would be a terrible investment, which is why it’s crucial to vet and qualify anybody you bring on to help you with your work.

The Financial ROI of a Virtual Assistant

This can be difficult to track, depending on how your compensation is structured. Here’s a simple example.

A freelance illustrator who charges $90 per hour for work hires a VA to cover two hours per week of administrative duties at $15 per hour. She then fills those saved hours with additional work for hire. This means she invests $30 per week to make an extra $180, with an ROI of 6 (180/30), or 600%. That’s a good deal, and the illustrator would be smart to increase the tasks assigned to that VA until she ran out of tasks.

But what about a salaried employee, commissioned sales rep, or self-published author whose time doesn’t equate directly to money? It’s still possible to track ROI after seeing results.

For example, a commissioned insurance salesperson might hire a VA at $500 per month to cover appointment setting, paperwork, and general administrative tasks. He would watch his sales statistics for the next few months to see what that did to his sales. If they improved by $500 or less, it was a bad investment. If they improved by $1,000 or more (an ROI of 2, or 200%), it was worth it.

ROI Over Time

Many investments, including hiring an excellent virtual assistant, pay out a higher ROI as time goes on. For example, if you spend $1,000 to buy an annuity that pays out $100 each year, your ROI for the first year would be terrible: 0.1 (100/1,000), or 10%. That would be an awful investment if you quit after the first year. Twenty years later, though, it would have paid out $2,000, for an ROI of 200%.

A VA will require training upfront, meaning the ROI for time and money will likely be lower during the first few weeks. But after that, it will continue to increase for as long as you work with that assistant. Let’s say you hire an assistant who saves you five hours per week but takes 10 hours for you to train. Her ROI over time would be:

  • First Week: 0 hours return for 5 hours invested: 0% ROI
  • Second Week: 0 hours return for 10 hours invested: 0% ROI
  • Third Week: 5 hours return for 10 hours invested: 50% ROI
  • Fourth Week: 10 hours return for 10 hours invested: 100% ROI
  • Fifth Week: 15 hours return for 10 hours invested: 150% ROI
  • Sixth Week: 20 hours return for 10 hours invested: 200% ROI

And the value would continue to increase with each subsequent week. After one year (52 weeks), you would have seen 250 hours of return for 10 hours of investment, an ROI of 2,500%.

Of course, that compounding effect stops every time you need to train a new assistant. That’s why it’s good to hire one from a pool of experienced professionals held accountable by a guiding organization. That will minimize the training costs while maximizing longevity, keeping investments low and returns high.

Final Thought: Some Things Are Priceless

One final item to consider when deciding whether it’s worth investing in a virtual assistant is emotional returns. Sometimes, trading a task you dislike for a task that energizes and interests you is worth breaking even with time and money, or even spending a little more than you get back. For example:

  • A work-from-home parent hires a local teen to go grocery shopping so he can spend more time with his children.
  • An independent author gets a VA to handle sales so she can focus on writing more books.
  • An absent-minded but brilliant consultant hires an assistant to manage his schedule and front-line communications.

These situations might not save time or money, but they can reduce stress and increase the quality of life — which in the long run can lead to better earnings and more productivity.

Bruce Hunt is an entrepreneur who uses a virtual assistant in his business, especially during his busiest times of the year.