After you wake up in the morning, you are looking through your closet and thinking what you should wear today for work. You notice a shirt that does not look too bad but the texture makes you uncomfortable. Thinking that you have paid $30 for it, you do not want to simply let it stay in the closet. Not wearing it anymore after wearing it only once would mean the money has simply gone down to the drain, right? You decide to put up with the discomfort and wear it.
After you leave the house, as you are walking to the parking lot, the sky looks very gloomy and is drizzling a little. There is a chance of raining today. But because you feel that you have already walked so much, you do not want to go back to grab your umbrella.
At work, you have been working on a project that has already cost the company a few thousand dollars but there is very little return. Your colleague asks you, "should we consider dropping this project and put our money, time and effort on the other project that is going well?" Then you get a little upset and said, "there is no way we are going to give up. We have already invested so much in this."
It is lunch break now and you go to a Korean restaurant that you like. The line is not long but not short neither. You still decide to write your name on the wait list and wait, hoping that it is actually not going to take too long. After 10 minutes, you are still waiting in the line and there are still quite a few people in front of you. Then you take a look at another restaurant nearby, which you think is also good and does not need to wait for. But thinking how much time you have waited already, you immediately squash your thought of changing to another restaurant and end up waiting for 20 minutes in total.
At night, you are watching a Netflix movie at home. After watching 20 minutes of it, you do not really enjoy that movie and you just do not think it is going to end well neither. But you feel like, "I have watched it for 20 minutes already. I feel like I should watch until the end." So you keep watching for another 50 minutes.
It definitely does not feel good when we see the money, effort, time we have spent become costs that do not come with a return. But when a cost is sunk, it has already incurred and there is nothing you can do about it. Your cost-benefit analysis should look at what has happened as something completely irrelevant and focus on the future. Look forward. Do not cry over spilt milk.
Also read: Why Do You Finish Your Plate: Waste Aversion and Sunk Cost Fallacy
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