Opportunity Cost Calculator

Opportunity cost is the value of the best alternative you give up when you make a choice. When you spend money on a purchase, the opportunity cost is what that money could have become if you had invested it instead — often far more than the sticker price, because invested money compounds over time.

Take the amount you plan to spend (or the difference between the option you want and a cheaper alternative) and project it forward as an investment: FV = C(1 + r/n)^(nt), where C is the amount, r the expected annual return, n the compounding periods per year, and t the years. The result is the future wealth the purchase costs you.

You rarely have to choose between buying and not buying at all. Often the real choice is between an expensive option and a cheaper one that does the job — a new car versus a solid used one, a top-spec phone every year versus keeping yours for three. Investing the price difference captures most of the wealth benefit while you still get the thing you need.

Broad stock market index funds have returned about 7% per year after inflation (around 10% nominal) over long periods, although returns vary widely year to year. High-yield savings accounts have historically paid roughly 1–5%. Use a conservative figure for planning, and remember that past performance does not guarantee future results.

Yes. The headline number is the nominal future value of the money you would invest. Set an inflation rate under Advanced Assumptions and the calculator also shows what that amount is worth in today's purchasing power, so you can compare it fairly with prices you know today.

No. Opportunity cost is a trade-off, not a verdict. Some purchases are worth every cent of future wealth they cost. The point of this calculator is to make the trade-off visible, so the choice is deliberate rather than automatic — especially for upgrades where a cheaper alternative would serve you just as well.