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How to Avoid the Sunken Cost Fallacy

I'll never forget the worst movie I've ever seen.

I'm at my friend Grace's house with a group of friends from around the country. It is the second to last day of our trip and we're all worn out from a long week of traveling and fun. We decide to lay low today and start discussing what we want to do. Someone suggests playing cards and another suggests a movie. We vote to decide because "'MERICA" and democracy decides to watch the movie.

Only 15 minutes into "Casa de mi Padre," arguably Will Ferrell's worst film, someone asks, "Why are we watching this?" We decide to give it 15 more minutes. It doesn't get better. Grace suggests we play cards instead, but I argue that at this point we're "committed."

We suffer through remaining hour of the film and finally turn it off before the credits even begin, ready to rid ourselves of the horrible acting and cheesy writing.

The stakes were low, but that afternoon my group of friends and I fell victim to the Sunken Cost Fallacy, or a tendency to follow through on an endeavor we have already invested time, money, or effort into.

The Sunken Cost Fallacy can "get" us in a lot of our areas of our lives, not just movies.

It could be a friend that we no longer enjoy being around but keep inviting places, a meal we force ourselves to finish because we paid for it, or a job that we grit through everyday because we've been there so long. The thought of "losing" our invested time, money, or effort keeps us committed to a task that is actually more detrimental in the long-term than simply cutting our losses.

The reality is if we have invested time, money, or effort- that investment is gone and forcing ourselves to finish the task will only result in more time, money, or effort being lost.

Cut your losses. Find a better investment. Don't be a victim of the Sunken Cost Fallacy.


Conduct a quick "Sunken Cost" audit. Are the potential benefits of your endeavor worth the further investment required?


Are you still doing what you're doing because it makes logical sense, or because you're emotionally attached to what you've invested thus far?


"Starting down the wrong path doesn't oblige you to commit to it forever." - Anonymous

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