“There ain’t no such thing as a free lunch.”
Doing one thing makes you sacrifice the opportunity to do something else of value so everything in life has an opportunity cost.
In life you cannot avoid making decisions, maybe a simple or one that could change your life. I myself experienced this situation before and I know that won’t be the last one. Now, you’re thinking is this somehow related to economy?? I say YES. In everyday life, without realizing we’re applying some of the economic concepts.
In economics, opportunity cost is the cost of not choosing the next best alternative for your money, time, or some other resource. One of the foundational principles in economics is affirmed by the popular American aphorism, “There ain’t no such thing as a free lunch.” Resources are scarce. When resources (time, money, mindshare, autonomy, and all that)
As we all know human needs are unlimited but the resources are limited. You might say ” I’m contented with what I have.” There’s more than that to it. needs are not limited to material things. It could be other things such as time. You often hear people say ” I don’t have much time”. You desire for more time, but you don’t have enough. In this context, time is the resource. You’re facing scarcity. Scarcity arises when people desire more things than available resources can provide. Then you have to make a choice. As a rational human being of course you would want to make the best choice. If you are an individual you’ll make your choice based on ones that will maximize your satisfaction or if you are a firm of course your choice will be based on which one will maximize your profits. When making big decisions like buying a home or starting a business, you will probably scrupulously research the pros and cons of your financial decision, but most of our day-to-day choices aren’t made with a full understanding of the potential opportunity costs. If they’re cautious about a purchase, most people just look at their savings account and check their balance before spending money. Mostly, we don’t think about the things we must give up when we make those decisions.
However, that kind of thinking could be dangerous. The problem lies when you never look at what else you could do with your money or buy things blindly without considering the lost opportunities. These are the kind of decisions that we make every single day in all areas of life with every action. How do you decide what to give your finances, time and attention to? What are the short term and the long term effects of your decision? Success takes a lot of discipline and smart work so my advice to everyone on the journey to find success is to be smart with your management. You can’t do your bare minimum and expect to see great result. Put in the work that you need to, spend time doing worthy things, spend money wisely and generally manage the areas of your life smartly and success will be inevitable.
Manage your money & time effectively, fill your time with worthy doings & events and learn to weigh your opportunity costs before taking any action.
