Opportunity Cost

There is a simple economic principle called opportunity cost which Wikipedia defines as: The cost of any activity measured in terms of the best alternative forgone. It is the sacrifice related to the second best choice available to someone who has picked among several mutually exclusive choices.

I have known about the principle of opportunity cost for years, however it only occurred to me recently that this idea reaches far beyond the scope of economics. Every decision we make in life has an opportunity cost; that is to say that every choice to do one thing is a choice NOT to do something else. So simple that when I read it back to myself I just can’t help but think, “Duh, what took you so long to figure that out!”

But, for whatever reason it did take me a while (nearly 36 years in fact). But now that I DO understand this simple concept it has given me several gifts:

  • I no longer feel trapped by my past decisions and instead realize that most decisions aren’t permanent. I may not like the choice of undoing a previous decision but it is still a CHOICE that is usually completely within my control. Once, when I was trying to explain this idea to a friend (before I’d made the connection of the handy opportunity cost analogy), it was suggested that I was justifying my past choices because the alternative was too depressing to think about. My friend felt that if I admitted that I had made the wrong choices and it was too late to do anything about it then it would just be too awful to bear so, I had to convince myself that my past choices were the right ones. I could feel in my gut that there was something wrong with my friend’s assessment of the situation but I couldn’t quite articulate what exactly it was at the time. Now I realize that the nameless idea that was brewing under the surface was this: My life is not built on one choice; it is a succession of choices that I have the opportunity to reevaluate and alter each and every day. Knowing this I continue to choose THIS life because, for me,  it is preferable to the alternative.
  • I have been able to let go of  resentful or jealous feelings toward those who are enjoying the opportunities I sacrificed. I used to see people traveling to places I only dream of, pursuing careers that are not an option for me at this moment (or possibly ever), relocating to cities with more opportunities than my small town, etc. and feel depressed or defeated. I no longer feel that way because I know that I COULD have those things but the sacrifices I would have to make are not worth it to me. At the end of the day my missed opportunities are second best compared to the life I choose for myself.  I also now realize that the people I was wasting time envying or resenting have also made sacrifices.  While  differences in personality, economic standing, power, etc. will always mean that some people have fewer limitations than others that doesn’t change the fact that EVERYONE has SOME limitations. And as a result of those limitations we all must sacrifice something, even if those sacrifices aren’t readily apparent to everyone else.
  • I used to think that we should strive to have no regrets on our death bed and therefore should pursue every opportunity we could. Now I realize that regrets are almost inevitable simply because we have a great big, beautiful world out there that is FULL of wonderful options; there is no way we could possibly do it all. So, now my goal isn’t to look back at the end of my life with no regrets, it’s to consistently strive to recognize which choice is the best option for me at this moment in time so the wistful yearning for the inevitable missed opportunities will be minimized, even if it never fully disappears.
  • I realize when I look around at the life I’ve built that each piece of it, as as well as every “missing” piece, is a choice for my best life. The sag in my sofa, missed travel opportunities, career plans put on hold, dirty dishes in the sink, living far away from cities etc. are all things I don’t always like or enjoy but are still part of choosing my best life because the opportunity cost of changing them is too high. I am not willing to sacrifice homeschooling my kids, the amazing connection I have with my husband, close relationships with friends and family, or my own contentment for any of those things. Changing some of those things I don’t like might be great but it would still pale in comparison to what I already have.
  • I am able to see my “downtime” as just as valuable as my time spent working toward a goal. My personality is best suited for a low-stress, laid-back life. For me this particular lifestyle is highly valuable and important for me to feel happy and fulfilled.  This may mean that I don’t pursue every hobby, attend every event that might be interesting, be productive all the time or even fulfill every dream I have for myself. But I’m okay with that. I don’t think I’ll regret the time spent sitting in the sunshine with a friend while the house is kind of a mess, watching a silly movie with my husband instead of writing a blog post or staying  home with my kids instead of exploring the Mayan ruins. This doesn’t mean that I don’t WISH I could do it all but the realization that I can’t has given me permission to let go of some really great things in exchange for even greater things.

I think it’s important to clarify that what I’m discussing here goes beyond the adage to “count your blessings”. I’m not simply talking about looking for the good AMONG the bad, I’m talking about realizing that some of the things we perceive as bad are NECESSARY because, in our particular situation, they are mutually exclusive to things we value more. In other words we don’t just appreciate X in the absence of Y, we understand that choosing X necessitated the sacrifice of Y.

Sometimes the choices we are presented with are simple and straight-forward, other times they aren’t. Sometimes the sacrifice is the result of choosing to be part of a family that makes demands on our  time, energy or resources; other times it’s because we choose an opportunity for quiet moments among the daily grind instead of filling every moment working toward a goal.   But whether the choice is easy or difficult, for someone else or for yourself the realization that lost opportunities are inevitable can help you make careful, conscious choices and then embrace them.

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2 responses to “Opportunity Cost

  1. Fabulous! This really applies to some stuff I’ve been struggling with, as you know, and I greatly appreciated your *balanced* thoughts. I’ll be sharing on Facebook!

  2. Pingback: What We Want Them To Learn Part 4: Goal Planning | Hopeful Insights

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