I had a nice post lined up for how I was going to relate money to opportunity cost and opportunity cost to the concept of time, but WordPress lost my autosave somehow.
So just take my word for it, ok?
Just kidding, let’s revisit this attempt. In terms of consultation and productivity I want to explain to the average reader why “Time is money” and “Time is opportunity”.
The easiest way for me to explain my adage “Time is opportunity” is to examine the corollary and see if that’s true.
“Wasted time is Wasted Opportunity”.
Sounds like a true statement right? Think about it, if you’re late for a deadline, or waited too long to put it in that application means it can mean that you missed your opportunity. You wasted time therefore you wasted your opportunity. Let’s look at the concept of opportunity cost to further illustrate the corollary.
According to Investopedia.com opportunity cost is defined as “The cost of an alternative that must be forgone in order to pursue a certain action. Put another way, the benefits you could have received by taking an alternative action.” http://www.investopedia.com/terms/o/opportunitycost.asp
I’ll give you a moment to think about that…
This concept represents a choice between two mutually exclusive options. Whatever caused you to be late for that deadline was a choice made by you (whether it was to do something else entirely or just procrastination was the result of an active choice by you). The cost of that opportunity (or choice) was being late for the deadline. That being true, you could easily make the assumption that every choice has an opportunity cost, right? And even further you can say that every good choice can equal opportunity while every bad choice can equal wasted time.
Here’s a choice and the opportunity cost of either choice:
You can go to McDonald’s and get a meal for 3 dollars or you can go to a grocery store and buy items to make a meal for the same price. Each choice has its pros and cons. Going to McDonald’s would lead to the food being prepared and being almost instantly ready for you to eat. The cons means that it’s terribly unhealthy for you and is only one meal. Going to the Grocery Store means that you can get a much healthier meal and there are possibilities that you can make more than one meal with the ingredients you purchased. The cons would be the time it takes to prepare and the fact that you would have to prepare it yourself.
The smarter choice is obviously going to the grocery store versus McDonald’s the food would be healthier and you would have ingredients to make another meal.
Hopefully that example helps you better understand the concept of opportunity cost. Now, you may be asking yourself, how does this relate to “Time is Money”? I’ll gladly explain that in one second but I would like to take a moment and relate opportunity to money.
Dictionary.com defines opportunity as a good position, chance, or prospect, as for advancement or success. Opportunity is a chance to be successful. There are many ways someone is defined as being successful, be we want to be successful in our management and acquiring of money. So if you take advantage of a financial opportunity you’re taking advantage of a chance to be successful.
I’ve done a lot of explaining: “Wasted time is wasted opportunity” and “Opportunity is a chance to be successful” and hopefully we can all agree that being successful can relate to good financial health. Why am I explaining this though? What’s the point?
The point is that every day we are presented choices to make, some of them are trivial:
“Do I have oatmeal or cereal today”
While some of them are paramount and can equal a missed opportunity were you to choose wrong:
“Do I play video games today or do I spend a few hours looking for a new job?”
In closing, if you agree that “Time is Money” then you must agree that “Time is Opportunity”. No one would ever give up on money so do yourself a favor, take that opportunity, stop wasting time, and go out there and be successful, acquire that money!