Opportunity Cost Calculator

A calculator that shows you what you would miss out on when you choose one thing instead of another.

Reduce the expenses, make

$0

extra over 30 years

Opportunity cost is what you lose out on when you choose one thing instead of another. For example, if you choose to buy a car, the opportunity cost is what you could have done with the money instead, such as investing it or using it to pay off debt.

To calculate the opportunity cost, imagine how much money you could have saved by spending less and investing in a low-cost index fund like SPY. It also considers the increasing prices of things over time and any extra money you could have saved each year.

Understanding opportunity cost is crucial for making informed decisions. It allows you to evaluate a particular choice's potential benefits and drawbacks, enabling you to make the most efficient use of your resources. By recognizing the opportunity cost of a decision, you can assess the trade-offs involved and make smarter choices that align with your goals and priorities. Ultimately, being mindful of opportunity cost can help you make better decisions that lead to more favorable outcomes in the long run.

Opportunity cost plays a critical role in shaping your financial decisions. By factoring in the potential opportunity cost of each choice, you can gain a more comprehensive understanding of the financial implications of your decisions. This enables you to make informed choices that avoid short-term gains at the expense of long-term financial stability. You can optimize your resources to achieve greater financial security and success over time by aligning your choices with your financial goals and priorities. In short, recognizing opportunity cost is essential for making sound financial decisions that support your overall financial well-being.