Life Can Be Calculated Using the DCF Method
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TL;DR
The author explains how the Discounted Cash Flow (DCF) method provides a framework for valuing long-term personal growth over immediate gains. By viewing life as a marathon, one can find peace and avoid selling their potential short.
Reading the ENGLISH translation
There is a concept called the DCF method.
It is a calculation method often used in the consulting and M&A industries, but to put it simply, it is a way of looking at money that will come in the future by converting it back to its present value rather than taking it at face value. 1 million yen received in the future is not the same as 1 million yen in hand today. There is time, there is risk, and you never know what might happen along the way. Therefore, future value is not viewed at its nominal amount. This is the DCF method.
I have come to believe that this isn't just about money. Life is also a DCF method.
When you are young, you tend to judge things based on the numbers in front of you or easily visible results. Are you profiting now? Are you ahead of those around you now? Do you have many possessions now? That is the perspective. As I have aged, I have come to think that looking at things only through that lens is dangerous.
There are certainly things that may be plain now but will yield great returns later, and there are things that are flashy now but will leave almost nothing behind later.
The books you read, the people you meet—these things may seem small the moment you receive them, but like future cash flows, they can produce value after some time has passed.
For example, making a large purchase that is a bit of a stretch when you are young. If you look only at that moment, it is an expense. However, that purchase can trigger the growth of a sense of responsibility or make your own values clearer.
There are also choices that just feel good right now. This isn't to say you shouldn't seek immediate comfort, but if you continue to view everything only through its present value, you will end up treating your life like a series of short-term trades. I believe that perspective gradually makes the heart feel restless.
Viewing life through the DCF method means having the habit of thinking once, "What will this become later?"
Humans inevitably see things that are close to them as larger. We care most about the "now." Hardships when young or unrewarded time can look like they "had no meaning" if you cut them off at that point in time. But since I believe life is a marathon, I think we should focus on continuing to run for a long time rather than running fast right now.
Since I started thinking this way, I feel I have gained a bit of composure.
Even if there are things that are not being rewarded now, I no longer immediately give them a zero rating.
I think life is the DCF method.
If you don't include what will come back in the future, you will misread the value.
Do not sell your life short based only on today's value.
It sounds like a story from the world of money, but I believe this is very useful when looking at life as well.
I run a membership called "Thinking Gym" for people who haven't studied much.
If you join this month, it is 500 yen permanently.
The price is scheduled to increase from next month onwards.
