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What Is Opportunity Cost?

What is Opportunity Cost?

opportunity-cost
Poor people place no value on their time.

 

Every single decision you make comes with an associated cost, whether you see it or not. Time or sacrificed activities are the price you’re paying.

Successful people understand this and assess the cost of the decisions they’re making.

Opportunity Cost Examples:

Here are some prime examples of opportunity costs that an average person would be happy to pay:

  • Waiting in line for hours to buy a new product on launch day
  • Driving an additional 20 minutes to save a few dollars at a cheaper petrol station
  • Filling out a lengthy online survey to receive a free _____

opportunity-cost-2

I personally would not agree to any of the opportunity costs above, because I value my time greater than the few dollars that can be saved or being able to say you’re the first one to get the new product.

Regardless of what you’re gaining or doing, something else (another opportunity) is being lost – weigh up your options before you rush into things.

Benefits From Assessing Opportunity Cost:

Assessing opportunity costs will allow you to ensure you’re utilizing your time as effectively as possible. Quite often, a decision which sounds attractive initially comes at a price you may not have been willing to pay.

Assessing opportunity costs will have you thinking logically and will reduce regret as you will no longer rush into situations.

My Experience With Opportunity Cost:

I used to just think about cost in terms of dollars and cents. As I began to implement successful habits into my life, I quickly realised that money wasn’t my limiting factor – time was.

Hanging out with negative people (specifically insecure people as I mentioned earlier) may not seem like a big deal, but when you actually look at the opportunity cost, it can ruin your life.
By associating with those negative individuals, you’re not only losing time that could be used discussing ideas and networking with successful, positive individuals, but you’re also getting sapped of any motivation, drive and energy you have – I speak from experience.

An example of the opportunity cost of me going to the movies would be the same as that if I were to go out for a meal or go rock climbing with friends (in terms of time and money cost, these are extremely close).

 What’s Your Take On Opportunity Cost? Let Me Know In The Comments Below!

Scott J.
Scott J.https://ignorelimits.com
I’m SJ. I’m a fitness enthusiast and published author. I transformed my body from a skinny fat 135lbs with 18% body fat to a solid 192lbs at 8% body fat. I became qualified in a field I was passionate about. I founded several online businesses that allow me to pursue ideas and projects in my life that I am passionate about without having to constantly worry about money. I published several eBooks explaining the training and dieting techniques I used to achieve the body I have today. I learnt a plethora of new information on dieting and fitness by reading and applying what I read, to find out what does work and what doesn’t work, because as I’m sure you’ve noticed the health and fitness industry is full of non-sense claims and BS. I found out what was true and what worked for me and applied that knowledge. And you bet I had fun during the whole process.

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