We’re aware of how much something costs. But what we forget about are things like what has to be given up to purchase, or what space will be taken up by the purchase, or transportation costs, and a great deal many other things.
It’s impossible to foresee every opportunity cost to an item, but there are major ones we should be mindful of.
- How many hours of work does this one purchase equal?
- If we didn’t purchase, what would we do with this money?
- What purpose is this purchase serving?
That last one is where hidden costs can really creep up. Is it a necessity? Or a want? Or just frivolous spending. Think about it, before spending your hard-earned money.