Tag Archives: choices

Decisions: Part 2

Every day we are faced with countless decisions that will alter our path in some way or another. I recently read an article that stated the average person makes over 5,000 conscious decisions a day. That’s almost 2 million choices a year. We weigh these decisions differently of course and make the majority of them in a split second. Some of these choices we look at as insignificant and others as life altering, depending on the person.

Take getting dressed in the morning for example. When I pick out what I’m going to wear in the morning it takes me about 10 seconds. Literally, 10 seconds, and 5 of those 10 seconds are groggily spent trying to find the closet door in the dark. Obviously, I don’t place a lot of value in this area and thus, I don’t spend much time thinking about it. There are however, those of you that place a lot of value on what you wear each day and go to great lengths to perfect your style and make a statement with your appearance.

Chuck Taylors

The vast majority of the decisions you make over the course of your life will have a relatively small impact on its outcome.  Captain Crunch or Cheerios, Chuck Taylors or Air Jordans, skim or 1% milk; regardless of your choices, in most areas your life you will keep going down a certain path.

However, there are some pretty big choices you will make that can and will significantly alter the path you find yourself on. The following are some (not all) of those big life changing decisions, placed in the order in which a lot of you (but not all of you) will face them. In fact, you may and probably will find yourself faced with some of these decisions multiple times in your life.

  1. Your decision on hobbies and extracurricular activities
  2. Your decision on spirituality/religion
  3. Your decision on education after high school
  4. Your decision on a career path
  5. Your decision on where you will live
  6. Your decision about a spouse
  7. Your decision about family

The first three, possibly four, life changing decisions you will make can take place while you are still in high school. Let that sink in. Over half of the life changing decisions you will make in your life can be made before you graduate high school.  Imagine your life as a book and you are writing the table of contents right now. You have the rest of your life to fill in the details, but the core content, the outline, you are putting into place today.

You are currently making the decisions that you will be living out for the rest of your life.

Your decisions matter.

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Opportunity Costs for Going to College

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Going to College is expensive. I know, everybody is yelling “well duh!” in unison. But it’s even more expensive than you might think. Opportunity costs are very important to consider when planning whether or not to go to college.

Let me quickly define what I mean by opportunity costs for the purposes of this article. An opportunity cost is simply a choice between two possible options where you judge the benefits of one choice over the other.  You can choose to do this or you can choose to do that. You can buy a 1998 Chevy Cavalier or you can buy a new 2012 Toyota Prius. You can have cereal for breakfast or you can have oatmeal. You can choose to go straight to the work force after high school or you can choose to go to college.

Let’s look at the workforce or college example in more detail.

A lot of people when taking into account the financial implications of going to college only consider the debt they accrue while attending college; room and board, books, fees, tuition, etc.  They often don’t consider one of the biggest financial factors in the whole equation which is the cost of giving up four years of income to attend college. Four years of income will often add up to more than the total cost of tuition and all the related expenses. Four years income is a big chunk of money.

For example; we have two students who are graduating high school. One decides that he will go straight to the work force and the other decides to go to a four year college.  The student who chose to go to college will pay, or more likely owe, $71,440 when starting his or her career. But not only that, they will also be out an additional $120,000 in lost income. The $120,000 sounds like a lot but it is really pretty conservative, just take $30,000 a year multiplied by four years.  So college for that student came at a $191,440 cost of opportunity. At 22 years old after graduating college that student is down $191,440; let that sink in for a minute.

Now we move on to our student who chose to go straight to work after high school. Let’s say he or she chose to become an auto mechanic. The average salary for that job is $36,180. Multiply that by four years and at 22 years old that student is in the positive $144,720. That is a difference of $336,160 between the two. That’s a lot of money!

I want to be clear that I am not discouraging going to college at all. In general, college graduates earn more than high school graduates do. The unemployment rate is lower for college graduates than it is for high school graduates. Going to college is a must for a lot of career paths and it tends to provide more flexibility.  However, as I mentioned earlier, it is important to understand the opportunity costs. Make the decision from a position of knowledge and confidence.

Ask yourself; “Is accepting that cost necessary to get me to the place I want to be?” or more simply put, “is it worth it?”

As a side note, $71,440 is the average cost of a four year in state college based on data from College Board located here http://trends.collegeboard.org/college-pricing/figures-tables/average-published-undergraduate-charges-sector-2012-13. Check it out.

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