Opportunity Costs - the things that you are missing out on

Have you ever felt that there is never enough hours in a day to do all the things that you would like to do? I feel like that all the time! The thing is, I did a little calculation one recent evening, whilst lying in bed wide awake in a sleepless night; it occurred to me that in fact, I only have about 6 hours a day at my disposal instead of 24 hours. I work from 8 to 6, and I sleep around 11 or 12. The number of hours that I can devote to the things that I wanted to do outside of work is actually quite limited.  

 

Everyday, I would go to sleep, looking forward to another 6 hours of my life the next day. And yet, sometimes it feels like I am the only person experiencing this stifling time constraint. My colleagues (all of which have similar work hours) and some of my friends often ask me what there is to do after work! Where am I going with this, you might think. Well, most of us, from time to time, wonders if our money/ time / resources could be better spent elsewhere. What are the costs in the missed opportunities due to our decisions - such as deciding whether or not to bear the cost of going to college/ university, keeping the money or buying a house...etc.

Quoting US economist Thomas Sowell, "the cost of anything is the value that it has in alternative uses". For example, gold has some value because it can also be made into jewelleries. The missed opportunities, economists talk about them as the "Opportunity Costs".

Considering the opportunity costs help us to make better informed decisions. Considering the alternatives, think outside the box(es) or whatever else you want to call it. Nothing winds me up more than people's notion that buying me lunch is the best act of generosity on earth that they can offer me; "nothing beats a free lunch". In actual fact, the opportunity cost in getting this free lunch is my time, and I only have 6 hours a day!, stop asking for my time! (unless you are a friend and I do actually want to spend time with you. yes, you can all stop feeling guilty...).

As you can see, it gets a bit depressing when one over considers the opportunity costs all the time, always the "what ifs". However, let's face it, it is human nature to judge and experience the opportunity costs naturally - the sinking feeling when you know you have made the wrong choice, your time and resources could be better spent elsewhere... It happens, because we don't always know what's going to happen. In 1999, the UK treasury decides to sell off a lot of its gold reserves (400 tonnes!). Little did we know that the price would grow more than 3 times just a decade later (we could really use some of that money now! - oh well).

 Once again, it's interesting how human being make decisions, especially when opportunity costs come into play. Perhaps the grass is always greener on the other side.