How often do you account for adjustment costs?

If you’re not sure what adjustments costs are, not to worry, you’re not alone. Adjustment costs are a concept in economics, they are the costs associated with making any changes to the current business process.

Although the term is more commonly used in the business world, it’s also very applicable to your personal life. You see, any time you make a change in your life there are adjustment costs, and you should learn to account for them.

In business adjustment costs are both tangible, dollars and cents, and intangible, how people will feel about the changes being made, again, both of these costs apply in your life too. You see, change does not occur in a vacuum, and how you account for the consequences of change might determine whether the change is permanent or temporary.

If for example you make a drastic change in your life and those closest to you don’t handle it well, then the adjustment cost is high and you’ll have to decide what’s more important to you, the change you want to make or the feelings of others. There is no easy answer to this predicament, it’s a question you’ll have to answer for yourself.

So, the next time you’re thinking about making a change in your life, do some quick mental math and work through what the adjustment costs might be. Doing so will help you evaluate the price you’ll need to pay for the change you want to make, and you might even be able to reduce some of the cost if you prepare yourself and others in advance.

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