Opportunity Cost: The Bill Nobody Sends You

Our word of the day at my office today is opportunity cost. Plain meaning: what you give up when you choose one use of your money or your time over another. Every yes to a deal is a quiet no to whatever else that same money could have done.

I learned this one the expensive way, by parking myself in slow deals. A closing that drags for weeks does not just cost you the delay. It costs you the two deals the same money and the same hours missed while you waited. Money sitting still is not neutral. It is a decision, just one you made by accident.

That is why we chase signatures fast and kill dead lanes early. People hear "time kills deals" and think it means hurry. What it really means is that a lane you already know is dead still charges you rent every day you keep it alive. The kindest thing you can do for a dead deal is bury it and give the hours back to a live one.

Sellers pay it too. A seller who holds out months for a maybe buyer at a perfect price keeps making the payment, keeps paying the taxes and insurance, and keeps carrying the stress the whole time. A real structure that closes at a fair number is often worth more than the dream price that never lands. I have watched that math from both sides of the table.

So before I say yes to anything now, I ask one question: what am I saying no to by doing this? If the answer is two better deals and a month of my life, the yes gets a lot harder.

Still a student of this, and I get it wrong plenty. How do you weigh opportunity cost when you decide whether to stay in a deal or walk away from it?

Chris