Guide
Cost of Delay Guide (Opportunity Cost of Waiting)
See what cost of delay means, why timing can matter, how each input works, and how to compare “start now” vs “start later” in the calculator.
Published: December 22, 2025 · Updated: December 22, 2025 · By FinToolSuite Editorial
Try it in the calculator
Compare start-now vs start-later with your numbers.
Quick answer
Cost of delay is the estimated gap between a start-now outcome and a start-later outcome under the same assumptions. In shorthand: cost ≈ start now − start later. It depends on your rate and time inputs.
What it means
Cost of delay is a timing-focused opportunity cost. If you wait to start, you may reduce the time money can compound under the same assumptions. Learn the basics: what is cost of delay?.
Why starting earlier can matter
More time can allow more compounding under the same rate and frequency. Waiting shortens the compounding window. Outcomes vary because real-world returns, fees, taxes, and inflation can differ from assumptions.
Picking a rate? See return assumption tips.
Disclaimer
Educational purposes only; not financial advice. Examples are illustrative; real returns vary and investments can go down as well as up. Fees, taxes, inflation, and provider rules vary by country and account type.
Inputs explained
Lump sum / starting amount
The amount modeled today. Example: £1,000–£20,000.
Pitfall: leaving it blank or adding commas that break the number. Tip: enter whole numbers for easier scanning.
Return assumption (annual %)
Illustrative annual rate. Example ranges: 3%, 5%, 7%.
Pitfall: mixing 5 and 0.05 or APR vs APY. Tip: keep one format consistent.
Delay window
How long you wait before starting. Example: 6–24 months.
Pitfall: mixing months and years. Tip: convert months to years if you use formulas.
Time horizon / end date
Total period you want to model. Example: 10–20 years.
Pitfall: comparing scenarios with different horizons. Tip: keep horizon constant when testing delay.
Compounding frequency
How often growth is applied (e.g., yearly vs monthly). Keep it the same across scenarios.
Pitfall: changing frequency between runs. Tip: pick one frequency and hold it constant.
Contributions
This guide assumes a lump sum. If you add contributions, keep them consistent across scenarios.
Pitfall: changing multiple variables at once. Tip: vary one input at a time.
Need a walkthrough? See how to use the calculator.
Three scenario walkthroughs
Scenario A: Small amount, short delay
- £1,000, 5% (illustrative), delay 6 months, horizon 10 years.
- Look for: smaller delay → smaller gap between start-now and start-later values.
Scenario B: Medium amount, 1-year delay
- £5,000, 5% (illustrative), delay 12 months, horizon 15 years.
- Look for: a full year delay trims the projected total more than Scenario A.
Scenario C: Longer delay sensitivity
- £10,000, delay 2 years, compare 3% vs 7% (illustrative), horizon 15 years.
- Look for: higher rates widen the gap; lower rates shrink it.
More ready-made cases: cost of delay examples.
Common use cases
- “Should I wait a year before starting?”
- “What’s the cost of waiting for a ‘better time’?”
- “How does delay change my goal deadline?”
- “How sensitive is the result to the rate assumption?”
Planning by goal date? See cost of delay by goal deadline.
Safety notes
- The tool is a model, not a prediction.
- Rates are assumptions; returns can vary.
- Fees, taxes, and inflation can reduce net outcomes.
- If investing, values can go down as well as up.
- Try low/base/high scenarios to see a range.
More on assumptions: return assumption guide.
Next reads
FAQ
What is cost of delay?
It’s the estimated gap between starting now and starting later under the same assumptions.
How does the calculator estimate opportunity cost?
It models start-now and start-later with the same inputs (rate, amount, horizon) and shows the difference.
What return assumption should I use?
Use illustrative ranges and compare. See the return assumption guide.
Does a 6-month delay matter?
It shortens compounding time. The impact depends on rate, horizon, and amount—run both cases to see the gap.
Why do results change with the rate?
Higher rates make the gap larger; lower rates shrink it.
Are results guaranteed?
No. They are estimates based on your inputs; real outcomes vary.
Do fees, taxes, and inflation matter?
Yes. They can reduce net outcomes. Adjust assumptions if you want to see different net projections.
Can I compare multiple delays?
Yes. Save scenarios (e.g., 0, 6, 12 months) and compare side-by-side.
How do I use this for a goal deadline?
Set the horizon to your goal date and test different start delays. See goal deadline examples.
Final CTA
Save three scenarios: start now, start in 6 months, and start in 12 months. Compare the estimated cost of delay side-by-side.