The Crazy Useful Thing Economists Figured Out A Long Time Ago About Life

If we can all agree that we only get so much time in this one life, it seems the only question left is “how can I squeeze the most out of this thing?”.

We can philosophise and think about it until our heads go blue but there are a group of people who have, probably without realising, come closer than anybody else to a practical answer — Economists.

A Short Primer:

In the most general (and useful) sense, Economics is the study of limited resources.

You have so many teachers, where should they go? You have so many materials, what should you make? You have so much land, what should you grow?

All other things you might think Economics is - industries, money, investment - are just offspring of thinking about what to do with limited resources.

And since our time is limited, as we agreed earlier, what now?

The 80/20 of Economics in 1 Minute

If you ever dabbled in economics, you might remember this textbook example:

You have enough money to buy one chocolate bar and you choose a Mars bar. On the surface, the cost of a Mars bar is just the price. However, behind the scenes, you’ve also passed on the “opportunity” of eating a Snickers bar. Or an apple. Or giving that money to the homeless man outside the shop instead.

Whenever you use a resource like money, land, or time, there is always an “opportunity cost” attached to it.

To put this in a more useful way: “the cost of saying ‘yes’ to something (or someone) means saying ‘no’ to something else”.

It not difficult to see how this applies to “real life”:

3 years at university is not just the price of the tuition & accommodation, but also all the other things you could have done in those 3 years — the real-world work experience, the connections, and income.

Watching 3 episodes of House of Cards also means saying “no” to your small business or passion project for 3 hours.

Spending your money on new things also means you say “no” to potential new experiences and memories with friends.

The “I don’t have time” game

The fascinating thing about opportunity cost is that most people will ignore it.

Lets take the common complaint — “I don’t have time”.

I love hearing it because it means the person hasn’t understood opportunity cost and I’ve seen some of the most dramatic life transformations happen when it clicks.

The fact is - you, me, and any person you look up - we all have the same fixed resource every day. 18 waking hours.

Since we all start at the same point, the game isn’t “Who Has The Most Time?” it’s “Who’s saying ‘no’ to totally bullshit things?”.

I swear, the only difference between you and wherever you wanna go is repeatedly choosing not to do totally bullshit things you know you shouldn’t be doing but haven’t stopped doing yet.

In future, whenever you hear “I don’t have the time”, turn it into: “I’ve said “yes” to all this other stuff that I think is more important to me.”.

There is no such thing as a “yes” without a “no”.

And, more importantly, every time you say “no”, you create space for something else to take its place.

You will fill the time, whether you like it or not. And right now you are making yes/no decisions on how to fill it.

Now is your chance

Understanding the full cost of your decisions is one the most helpful and bullshit-free shortcuts to changing your life circumstance.

It can take a little time to get used to, but if you decide to, you can flick the switch and everything will somehow rearrange and re-prioritise itself. I’ve seen it happen and it’s magical.

Most people die whispering regrets because they didn’t see what their decisions actually cost. The time they spent destroying their body instead of looking after it. The hours in meetings instead of with their loved ones. All the years spent thinking about what could have happened instead of trying and finding out.

Now is your chance to live out the rest of your life conscious of the trade-offs you make with your time.

I hope you take it.