Does what I choose matter? I think it does; and, if it does for me, then it does for you as well.
In economics there is a term ‘opportunity cost’ that refers to the loss of potential gains from another alternative when one is chosen. Let me explain:
If you store your money in a box in your closet, then your opportunity cost is the interest you would have earned if you had instead put your money in an interest-generating fund of some sort.
Does that make sense?
Opportunity Cost considers only two choices – the one you make and the next best alternative. And it’s not always about numbers.
It’s the answer to the question, “What would I have chosen to do if I had not done this?”
Life is full of opportunity costs because life is a process of choices. So you may choose to take that promotion at work and forego more time with your family. Your opportunity cost is in the lost time of connection with those you love most.
Or you could do the reverse – choose to decline a promotion in order to safeguard your time with your family. In that case, your opportunity cost comes to the dollars and cents of the salary increase and the impact of that on your family’s lifestyle.
You may notice there is no talk of ‘right and wrong’ when it comes to thinking about opportunity costs. Like life, opportunity costs remind you that the power of choice is always yours.
Being aware of opportunity costs just enables you to clarify why you make the choices you do. And that is important. So often you might have your life on auto-pilot, moving through a series of daily activities that seem to be not so much chosen as pre-defined.
But that is not the case.
Life falls into auto-pilot when you forget to check your course and lose sight of your destination. Life falls into auto-pilot when habit takes over self-awareness and choices become more about what others expect than what you most deeply want your life to be.
If you can delay gratification, then you are in touch with opportunity cost. As any addict on the path of healing and recovery knows, not choosing the addictive behavior allows the better alternative of a sober, healthy life. They can postpone indulging themselves in the moment for their longer-term well-being.
Take some time and consider your opportunity costs. Think about some of the choices you are making in your life and see if you can figure out the opportunity cost of not choosing the next best option.
Maybe join me in participating in NaNoWriMo this year. National Novel Writing Month. That’s where you make a commitment to get your book done in the month of November.
That choice has opportunity costs for me that I’m still considering in the amount of time I will have to devote to my choice and the same time I will no longer have available to my next best option which is more client work.
So heighten your awareness of your own empowerment this week through choice and see what happens. I’ll be writing my novel.
Maybe you will too!