Glossary
Opportunity Cost
The value of the best option you gave up
Opportunity cost is the value of the alternative you gave up by choosing something. It covers time and options, not only money — choosing one thing means discarding the rest.
Put 10,000 in a deposit earning 3% and the opportunity cost is what that money could have earned elsewhere. No visible loss appears, yet a real cost exists.
Quit a job to study and tuition is not the whole cost. The salary forgone during that period is a far larger opportunity cost, and leaving it out makes the decision look cheaper than it is.
Holding a lot of cash has an opportunity cost too. It is safe, but purchasing power erodes with inflation and you miss market gains. Safety carries a price.
That does not mean seizing every opportunity. The point of weighing opportunity cost is not to avoid regret but to choose while knowing what you are giving up.