The Hidden Cost That Is Baked Into EVERYTHING You Buy or Do
One cost that most people forget about is opportunity cost.
If you’re going to devote your time, attention, resources, finances into an investment, into a business, into a purchase – there’s opportunity cost at play.
Learn more about opportunity cost and how it hinders you from growth in the future.
– Hey, everyone, I hope you’re having a wonderful day. Right now, it’s snowing here in New Jersey but that is only gonna last a little bit longer because I’m en route to Florida for Tony Robbins’ Business Mastery because we won the Shopify Build-a-Business, or excuse me, Build a Bigger Business competition.
We get to go to Tony Robbins event. Jess, our C.M.O. of BestSelf Co. is already there. The other Shopify winners are already there and I’m really excited to see them. And it’s gonna be a lot of fun. But, in doing so, I’ve seen a lot of things recently, and I wanted to talk about costs based on… Anything that you purchase or anything that you’re about to do in life.
So if you’re watching this in Turn On The Hustle or on Facebook page or on my timeline, or your timeline I guess, it is, great. If you’re watching this in BestSelf Alliance or BestSelf Facebook page, this can all relate to you because it is…relates to everybody. And everything that they do in a job, in a career, in some investment, or in just your lifestyle.
So, what I wanna talk about and, I heard Tim Ferriss say this multiple times, I saw a video that he created yesterday and it inspired me to create this video. What’s up, Nick?
So, BestSelf Co. is doing great, we’re growing, we’re expanding, it allows Cathryn and I to do things and experience things that a lot of people don’t have the opportunity to or that inspire them to have that type of lifestyle. That’s why we started BestSelf Co. To make an impact and to live a life that was more than just the status quo. And in doing so, our lifestyles change a little bit and I needed to purchase a new car.
My Nissan Exterra that I’ve been driving for seven years had 151,000 miles on it. It needed a little bit of work and I needed to look for another vehicle for the family, and as my wife calls it, a new family car. And we have a child on the way, so I was looking at ‘okay, what can I get? What can I do to…y’know… have a reliable car, and also something I would enjoy getting in every day?’ And in doing so, I started looking at these crazy vehicles, hundreds of thousands of dollars and… Range Rovers and brand new Range Rovers and brand new Audi Q7’s that were fully decked out and it had every option on it that you could imagine, and sitting down with my wife, and we were looking, we were like, ‘okay, could we do this?’ Yes.
If we really budget and put things in place and make sure that we…that we are… Diligent with our finances on a monthly basis, we could totally do this, this is feasible. But there’s one cost that a lot of people– finance departments, your boss, your manager, even your spouse– forget to mention to you, and that’s Opportunity Cost. And Tim Ferriss talks about this quite a lot.
If he’s going to devote time, attention, resources, finances into an investment, into a business, into a purchase, whether it’s a home, a vehicle, a teammate, whatever it may be, there’s Opportunity Cost at play. And what that does, is that hinders you from growth in the future. You might be able to maintain that standard for right now, when you make that purchase, or make that acquisition, or decide to go into that business, but what you’re sacrificing is the limited cap of what that- So, because I’m driving, the reception’s a little spotty, but that’s alright.
I hope you hung out with me for a second, thanks for the thumbs up. But there’s Opportunity Cost at play that hinder what you can do in the future. So if you’re gonna tie up a whole bunch of capital right now, a business opportunity comes along, or an investment, or a new business venture, well, you can’t capitalize on it, you can’t seize that opportunity, because you’ve tied up all your capital, you’ve tied up all your finances, you’ve tied up all your energy, your resources in this one department and it didn’t allow you to move as quickly.
And this happened, I’ve seen this happen so many times to different people. So when I was working in the corporate world, I was in Sales and the owner of the company literally had one person on his staff that, all they would do, is help you acquire crap. Right?
All they would do is help you get financing for a home, they would help you get financing for vehicles, they help…they would tell you all the time, “Oh, how’s your girlfriend doing? You should ask her to marry you.” Or “How’s your husband doing? Are you guys gonna get married yet? What’s he waiting for? Blah, blah, blah.” Because they wanted to tie you up and make you stay stuck in the company, because if you had all this debt out there, if you’re getting married, or if you’re having a baby, you would not be as flexible to go out and look at other opportunities, look at other ventures that were out there, look at other jobs or careers. You would feel, ‘okay, I need to maintain or sustain this baseline that I’ve created for myself.’ and then you’d essentially be stuck with that company or organization, and they do it all the time.
So when you’re look at, to either purchase a house or rent an apartment or go into business with somebody or start a new venture or just making a financial investment; what is the total cost going to be? Financially, okay it’s gonna cost me x amount of dollars over how long? Time, how much time and energy am I going to have to put into this? Is it going to be half of my day? Wow, that’s a lot of my day that I’m going to devote. Well, for how long? Is there a cap? Okay. Is there… a resource that I’m about to purchase? So if I train somebody and get them up to speed, so maybe it’s hiring somebody… Well.. Bringing someone on into your team, that is a… Opportunity cost as well.
That forces you to stay with whatever decision you make moving forward and doesn’t allow you to be as flexible. So when you’re making a purchase or when you’re about to devote some time into something… Figure out what the true cost is about. Figure out what the true opportunity cost is going to be in the long term. If you’re gonna go out with friends, and you’re gonna go and, y’know, spend $500 on drinks, on a Friday night. Well, what’s the opportunity cost on that? How long is it gonna take you to repay that $500 credit card bill?
There’s always opportunity cost baked into everything that you’re doing, everything that you’re investing in and every resource that you have. So, be extremely diligent with what the total cost is in anything that you do from here on out. And I hope you guys can make some better decisions moving forward in your businesses or in your hobbies or in just your personal lives as it relates to all of the energy that you’re putting into things so you know… So you could actually live a life that is flexible, that fulfills you and that pushes you to whatever you aspire to be.
So, I hope this was beneficial, if you like this, please share with somebody or tag somebody in this video and let them see this and gimme some love below, thanks for watching guys. I hope you are staying warm this winter afternoon. Bye.