There Ain't No Such Thing As A Free Lunch - TANSTAAFL

The concept of “there ain’t no such thing as a free lunch,” abbreviated as “TANSTAAFL,” basically means this: you can’t get something for nothing, yo. Everything has a price. Even if—or maybe especially if—it’s being advertised as “free.” It’s like the slang way of saying, “Let us consider our opportunity costs.” Because every decision we make, and every decision everyone else makes, comes with some kind of cost.

For example, let’s say we’ve decided to ride our bike to work instead of driving in an effort to save money. Sure, we’re going to spend less on gas and oil changes, but that decision is going to come with a cost: the commute that used to take us 15 minutes is now going to take an hour. That’s 90 fewer minutes we can spend with our family, our dog, our bed, or our latest video game obsession, every single day. That’s seven and a half hours a week, and that’s a pretty significant cost. There ain’t no such thing as a free lunch.

We’ll also see this term thrown around in the political and economic arenas. It’s often used to remind people that “free” government programs aren’t actually free—they’re paid for by the taxpayers (us). And in financial discussions, we’ll often hear it used when we’re talking about investment risk levels. If we want the big returns, we sometimes have to take the big risks, which could end up meaning big losses.

But that’s how it goes in the investment world. Wanna know why? That’s right: because there ain’t no such thing as a free lunch.