A cognitive bias is a systematic error in thinking. It affects everyone. Biases affect you even when you’re aware of them and actively try to correct the errors.
Today, I want to talk about The Sunk Cost Fallacy. This is a problem most people face when they have already invested some time, money and/or emotion into something. The issue is that when we invest anything, there is certain pain to let it go. Humans (and all animals) are a pain-averse species. So, we keep on holding on to things that we know aren’t going anywhere.
That could be a proposal that took 3 hours to make. Or a movie we start watching and realise midway that it sucks. Or a book we start reading and it gives us no joy. Or a dead-end career we are stuck in. Or a relationship that has no future.
The amount of time (or money or emotion) we have already invested in something has (or should have) no bearing on the amount of time (or money or emotion) that we need to continue investing.
Hope good. Optimism is necessary. Self-belief is mandatory. But, they are usually not the ones that keep us going. We continue down a road because we have already walked on that road for some time. It’s the cognitive bias that often masquerades as hope and optimism or self-belief.
The sunk cost is irretrievable. No matter how high the cost you have already paid, there’s no refund on the sunk cost. The sooner we accept that, the quicker we can decide the next course of action.
Be aware of The Sunk Cost Fallacy, and constantly keep it at bay. Do not consider the sunk cost in your decisions. Period.
Time to move on,