The Healing Hype
The Healing Hype
The Opportunity Cost of a Cost-Benefit Analysis

The Opportunity Cost of a Cost-Benefit Analysis


This is just a reminder that my next workshop, “Reparenting Your Inner Child Through Trauma-Informed Care” is on Saturday, 9/25 at 10am PST/1pm EST. This is free for members and $22 for non-members.

Non-member registration

You might see the title of this and be like, WHOA, did Nisha become an economics expert? No I have not, nor is that part of my plan. BUT, I have been thinking about the concept of a cost-benefit analysis, or even a simple pros/cons list, lately, especially in relation to making life decisions. And I’ve been thinking about what they often miss: expansive possibility.

So I decided to research and learn more about the cost-benefit analysis. According to Investopedia:

A cost-benefit analysis is a systematic process that businesses use to analyze which decisions to make and which to forgo. The cost-benefit analyst sums the potential rewards expected from a situation or action and then subtracts the total costs associated with taking that action. 

And THEN I saw how these analyses add in opportunity cost: “Opportunity costs are alternative benefits that could have been realized when choosing one alternative over another.” Essentially, this is similar to the expansive possibilities I was thinking about.

So I decided to take a look at the cost-benefit analysis and see how it would stack up for a recent decision I made.

My decision to leave my 9-5

Let’s use a big decision I recently made to leave my steady 9-5 job (where I just got a pretty great raise) and do a cost benefit analysis, with opportunity cost. For the purposes of this example, costs and benefits include tangible and intangible costs/benefits or resources. Opportunity cost includes the what if’s/possibilities.

Leaving My Job

Leaving my job would have the following costs:

  • Forgoing my pension

  • Higher cost health insurance and other benefits

  • Not having access to a flexible spending account

  • No direct access to books or other scholarly materials

  • No longer having a steady salary, along with my increased raise

  • Losing the opportunity to grow in skills/leadership at the organization

Leaving my job would have the following benefits:

  • Moving beyond the salary scale

  • Pursuing my passion and aligning with myself and better mental health because of it

  • Having more time to think and create in a way that my body is driven toward

  • Creating a whole product/offering suite for people

  • Supporting more people’s healing and life journey

  • Working remotely whenever and wherever I want

  • Not having to work with people who have a toxic hold over the organization (see: mental health)

Leaving my job would have the following opportunity costs:

  • Less collaboration and social contact with people in the field I admire

  • Leadership in the field in general

  • Editing or writing an information science related book

  • Not being able to innovate new projects and structures in the organization

Staying at My Job

Staying at my job would have the following costs:

  • Limit in salary range

  • Limited ladder for leadership experience

  • Less time or capacity to work on my “side hustle”

  • Mental health costs for not pursuing my passion when I was ripe and ready to leave

Staying at my job would have the following benefits:

  • Save more money so I could pursue my passion with more financial security

  • Rise in leadership

  • Not stress about consistent income

  • Access to low-cost health insurance and other benefits

  • Access to my pension

  • Continue to support and advocate for an anti-oppressive and trauma-informed approach at the organization

Staying at my job would have the following opportunity costs:

  • Never knowing the possibilities of how amazing I could be working on my own

  • Investing time and/or money in opportunities outside of coaching such as writing a book, collaborating with others, etc

  • Not having the time to know how far my side hustle could go, even expanding into public speaking, group experiences, and expansive collaborations

  • Unknown creative and activist opportunities including writing, art, and advocacy

This list isn’t exhaustive, but it’s what I thought of initially. The typical process of going through a cost-benefit analysis is to identify the costs and benefits, tally it up (assign dollar amounts the best you can for intangible and opportunity costs), and make a decision.

A clear limitation of this is that it’s nearly impossible to predict dollar amounts of opportunity costs. If leaving my job meant I could speak around the world and travel or write a bestselling book, it’s hard to say what that could mean in terms of money (and mental health). I also see “opportunity costs” as a limiting term as well. It’s almost as if it’s saying, “These things could happen, but who knows”, as opposed to “Wow! These things could happen!” I supposed I’m biased here, and maybe that’s just how I’m reading it. However, this is why I like “expansive possibilities” - it allows for faith.

I also feel that the cost-benefit analysis fails to measure safety for each. This includes all types of safety but especially emotional safety. And this includes safety related to identity. As a woman of color, moving to Mississippi has a higher safety cost to me than staying in California. Again, this is challenging to put in dollar amounts because safety is actually priceless. The common variable seems to be what’s unknown, the joy or pain we feel in our bodies, the quality of relationships we create with new and existing people, the context that surrounds us, and the expansion that knows no limits.

This doesn’t mean this isn’t a useful tool, but I feel like it’s a tool used when there is aversion to risk. To me it’s just….boring and limiting.

Where to start

How else can we start when making a decision, especially a life altering one, if not using a cost-benefit analysis or pros/cons list? I think it’s important to discern how much fear is playing into our desire to make a change (or not make one). And it also starts with feeling into our alignment and imagining expansive possibilities that can result from being in alignment and experiencing joy.

I know “alignment” might sound like total BS to someone who is struggling day-to-day and is constantly in fight/flight/survival mode. I don’t want to minimize the challenging and harsh consequences of capitalism, extreme wealth inequity, mental health challenges, disability and chronic illness, or food and housing insecurity.

While anyone, regardless of their situation is capable of taking action, the conditions some people are in because of systemic structures and the narratives we hear about working ourselves to the bone and our worth being tied to our work greatly hinder our ability to move forward.

But when you have the ability and capacity to look inwards, observe yourself and your behaviors, create boundaries, connect to your body, and ask for help, alignment is closer than you might think. We are all on different timelines for this. However, fear can keep us in risk-averse mode, telling us to ignore our body and coming up with reasons something won’t work. Having faith in expansive possibilities is scary because you have to believe in the unknown.

When you feel more aligned, you’re in flow. When you feel more aligned, you better see evidence that you have succeeded. When I left this job to pursue entrepreneurship, I had zero evidence of how this might work for me because I’ve never run a business on my own. BUT I had evidence of losing my father shortly before I got divorced and thriving afterward. I had evidence of getting published in an esteemed literary magazine and making leaps and bounds on my healing journey after moving across the country for a job where I was just going to make ends meet. I had evidence of speaking up after keeping myself small for so long as a result of parentification, emotional abuse, and gaslighting.

The evidence is there, but our bodies and nervous systems want us to remember what might go wrong because it wants to protect us. I love that it wants to protect us. But when we allow ourselves to trust and believe in what else we can do, so much opens up. Sometimes we might see that the costs and benefits just don’t have to factor in as much as we thought. And this is the opportunity cost of the cost-benefit analysis…we might never know what we’re missing.

I’m not saying every decision needs to be made this way. Sometimes it makes sense to not take that leap. But the hardest thing about making big life decisions is the discomfort that comes along with change and the fear of not just the unknown, but the fear of not knowing how those expansive possibilities will change our lives and make us grow in ways which we are unfamiliar.

And there’s something very Western and colonial about only looking at what is *known* and can somehow be measured. The unknown or immeasurable carries immense meaning. How does someone measure the relationship they have with the land? How water nourishes them? How the body gives them information about their emotions and mental health? Not only is it hard to measure, it’s hard to quantify the impact.

In the end…

In the end, we can make decisions in ways that take all the costs and benefits into account. And maybe this is a way to also see how it is limiting and there are other ways to make decisions. Of course, in certain settings, the cost-benefit analysis might be just what is needed.

If anything, experiment with doing both and see how you feel. Notice what fear comes up. Notice the joy that comes up.

I write this so we can begin and continue to question traditional modes of measurement and analysis, especially when it is steeped in capitalism and “rational thought”. The opportunity costs of a cost-benefit analysis can cost you immeasurable growth, immeasurable possibilities, and an immeasurable YOU.


The Healing Hype
The Healing Hype
Audio transcription and meditations for The Healing Hype