It is hard to make decisions.

Do we listen to our heart or our mind? Do we listen to ourselves, our peers, our parents, or our mentors? Not only do we have to contend with multiple outside opinions – we have a multitude of subconscious biases and influences running uncontrolled in the background of our brain.

Sunk cost fallacy

Sunk cost fallacy is when you make a poor decision in the present, influenced by the weight of your previous effort and investment.

Suppose you buy a pair of $250 pair of shoes. You have been saving for a long time for these shoes. They are finally on sale so there are no refunds. And once you wear them, you cannot resell them. After a week of wearing the shoes, you find they are uncomfortable and just do not fit you right. They squeeze your toes and blister your heels, no matter what you do.

You give them a chance and you wear them a few more days. People give you compliments and say they look good. But they become more unbearable. Your feet are sore, tender, and bruised.

So what do you do?

Option A: Do you throw them away (or donate them) and admit the $250 loss?

Option B: Do you feel the need to keep wearing them because you spent $250, and you do not want your money to go to “waste”?

Option A vs Option B

Clearly, Option A is the right decision. What has been done in the past is done. There is no going back in time. The most optimal approach is to evaluate the choices in front of you, as objectively as you can, and choose the best option in that moment.

In the example with the ill-fitting shoes – they make you miserable, and why would you inflict misery on yourself?

But our subconscious mind wants to cling to the past. It does not want to let go. It does not want to accept “defeat”. It pulls us towards Option B. It says – you spent your hard-earned money and time on this, and we cannot let that go to waste, right?

So what do you do?

Choosing between different jobs

At the beginning of this year, I was at a similar crossroads. On one hand, I had invested four years to go down a path that, in the end, I felt was not right for me. On the other hand, I had invested four years to go down a path that was not right for me.

So what do you do? Do you accept all the options before you, evaluate them as objectively as you can, and make the decision that is better for the current version of you? Or do you succumb to peer pressure, parental pressure, and your subconscious bias pulling you towards a job to justify your past four years?

I sat on the decision, in a state of limbo for a few months.

In the end, I chose to pursue Option A.

Question for you

When have you felt sunk cost bias, and did you choose Option A or Option B?