The Sunk Cost Fallacy

The sunk cost fallacy is a common decision-making trap we all fall into from time to time. It describes our tendency to cling to a project, dating relationship, or even a friendship simply because we’ve already invested time, money, or effort into it. Even when the rational choice is to walk away, the sunk cost fallacy makes us feel obligated to see things through, leading to wasted resources and missed opportunities.

This fallacy can also impact everyday spending. We might force ourselves to finish a restaurant meal we don’t enjoy because we paid for it, or continue paying for a gym membership we never use. These seemingly small decisions can drain our wallets over time. We also see this happen in relationships like friendships, romantic and professional.

So why do we get caught up in the sunk cost fallacy? There are a few reasons. First, we dislike waste and feel a sense of loss when we abandon something we’ve invested in. Secondly, the sunk cost acts as a justification for continuing – we reason that since we’ve already put something in, we might as well get something out. Finally, emotions like disappointment and regret can cloud our judgment, making it hard to let go.

People invest their time, thought and even money into systems & beliefs that they know are failing. However, we are seeing some break away from this illogical thinking in relation to the upcoming election. While I dislike dividing voting Americans by age, gender, race and et cetera, it is worth noting historic norms are shifting.

The polls (if accurate) are telling us that traditional voting blocks are starting to move towards reasonable policy. Workers are now shifting to Trump, regardless of race, gender or age. That is because Trump has called out the failed policies of people inside and outside of his party. You may have noticed the only star that needs to show up at a Trump rally is Trump. Unlike the other guy who needs Hollywood stars and past Presidents to draw more than a handful of people.

Is it time to share Sunk Cost Fallacy with friends who do not typically agree with you? I think so. We all invest time, money and emotion into the wrong things from time to time. Everyone can relate to that. It is knowing when to make a change that will rebalance your life and the country.

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