1. When the TCO analysis is performed to support budgeting and planning, or to support strategic decision making, ownership life for the analysis is normally taken as the complete length of time that ownership has financial impact:
Ownership life begins when the acquisition begins causing costs. This may include costs that occur before the actual arrival or use of the acquisition (see the "hidden cost" categories in the next section).
Ownership life ends when the asset is no longer causing costs and has no continuing financial impact of any kind. This means that all costs of disposal or decommission have been paid and the asset is no longer carried in an asset account on the company's balance sheet.
2. Alternatively, TCO analysis may be designed to cover an arbitrarily specified number of years, for example, 3 years, 5 years, 10 years, and so on. This approach is usual in these situations:
TCO analysis is performed to choose a vendor from competing proposals, or to prioritize competing capital acquisition proposals.
The actual economic life, or service life of the acquisition is uncertain.
The organization's asset life cycle management polices and practices dictate specific life spans for classes of assets.