Sunk Cost Fallacy And Why You Should Quit

[@jamessoriano8991]

"It makes difficult for people to quit something we feel we are too invested in especially since we might think that we are losing something because of it however most of the time it is better to accept our losses and move on as you never recover the true value of something once it is gone. Life is full of sunk cost it is better to recognize them but don't let it bring you down."

[@tommybomby4122]

thank you for telling me! i used to take german and thought i was too invested in german to switch to spanish. now i am going to take spanish next year

[@Jaggerbush]

It’s more than 10 hours on a flight - reasoning says a cold will likely last 48 hours. Odds are by the time you get to your hotel you’ll be on the mend. That’s much better than canceling you’re European vacation and the time taken off work only to realize hours after your flight has left that you indeed feel better. This is like having a fight and filing for divorce.

[@60secondsuccess39]

I really liked the message behind this video. Being able to make rational, unbiased decisions is a powerful skill to have. Also, I think you've hit a sweet spot for video length here. You managed to keep me captivated the whole time!

[@MindfulThinks]

Thanks! Yes, very powerful. We have so many biases that it's really hard to imagine that someone could make a totally unbiased decision, but we can come close. Oh, sweet! I like this video length too, so maybe I'll keep it! Thanks for the input!

[@rckoegel]

@@MindfulThinks There are no absolutes, we could even be wrong about basic theories of physics; all decisions are based on bias. It's just that some of those biases are superficial, shortsighted, or just plain wrong; while others are based on generally accepted facts. I mean we westerners used to think that allowing women to learn to read was a horrible thing for god sakes. It was even a crime in places. Now we're biased against the idea that women should be subjugated by men. What's the saying, the only sure thing is change itself.

[@maaly8111]

Just saw someone use this term. Had never heard it before. Thanks for the explanation.

[@pinnaclefinancial533]

This is truly applicable to Stock Marketing where at times you stuck with losing stocks & you continue to hold them thinking they will rebound or worse add more of those stocks to recover the losses.

[@LarryPanozzo]

Great advice. More people need to hear about this.

[@bobg9922]

This needs to be taught at schools and colleges everywhere

[@AlejandroBelloRD]

Awesome. Simple graphics illustrate this fallacy better than what can I explain to acquaintances that never heard of the term. Thanks! Subscribed!

[@MindfulThinks]

Thank you! Glad you could take some value from my video :)

[@SlooperDuper]

I have no loss aversion anymore. The perks of being a loser in high school I guess?

[@y__h]

2:00 A bomb dropped hard that day.

[@MindfulThinks]

Oh yeah, very hard.

[@ramjaykv]

"Asking for a friend"

[@AhmadAhmad-qx6fp]

What if sunk cost fallacy is just our fancy way to compromise our inclination to emotional attachment which numbed our rationality

[@aliyusx]

im traveling to italy next week and im kinda feeling sick... what to do?

[@LKLM138]

You started the covid in there?

[@aliyusx]

@@LKLM138 My comment was 1 year ago before Covid

[@LKLM138]

@@aliyusx I noticed. Was just trying to be funny.

[@aliyusx]

@@LKLM138 phew! U almost got me thinking I started a pandemic

[@raja_hustle4347]

go Italy

[@tvst7856]

I changed my major from accounting ASAP 😂😂😂

[@cliffordcolvard9495]

That girl in your class was really talking about herself

[@AttorneyonaJourney]

Ha!

[@Merrick.Morley]

I thank you for this short video and the message you conveyed. However, I don't think you capture - or even acknowledge - that daily decisions are a complex process that take into consideration more than economic or temporal aspects. Someone who is significantly sick may travel to Italy because they have a wedding that they otherwise would miss. They could also be locked into annual leave from work and wouldn't be able to reschedule. Reducing the situation, even though you have likely done so to highlight the characteristics of the fallacy, is dangerous

[@User24x]

Ouch for Accounting majors... 2:11

[@chuckygrl2932]

Then there’s me 😂accept my L and give it up. A giver upper😂😂

[@stevebean1234]

J Mayberry I’m not sure about this, but it seems my biggest regrets in life were from not quitting. I have a scapegoat mentality and it seems in almost every job, relationship, etc people eventually start blaming things on me. I still want to achieve the goal so I stay and stick out the abuse. But then the abuse because so damaging it shouldn’t be worth it. But I continued to stay and be dehumanized. It’s unhealthy

[@Emiliapocalypse]

There is also a wisdom in knowing when to walk away from things. “Giving up” is sometimes the right thing to do! Don’t feel bad, J 😁

[@theultimatereductionist7592]

It's a fallacy ONLY if you DON'T eventually get sufficient positive out of it. Otherwise, it's NOT a fallacy to continue to invest.

[@Devils.harp.player]

Absolutely! Just don’t focus on the sunk costs. Rather, focus on what the reward for perseverance will be.

[@theultimatereductionist7592]

​@@Devils.harp.player I am a PhD Mathematician. Philosophers and economists annoy the F out of me with their stupid arrogance. Both those who preach "failure = success/ failure = good" and their complete ideological opposite: those who use loaded words such as "irrational/rational" as well as "fallacy" to describe what THEY see in others as sunk cost "fallacy". I myself have a MUCH more sophisticated model of justice that stupid philosophers and economists are too closed minded to even consider.

[@Devils.harp.player]

@@theultimatereductionist7592 okkaaayy. Not really sure what that any of that means, but I hope you have a great day :)

[@wowbobwow-j9n]

I am in this perpetual feedback loop where I wonder if my artistic dreams/endeavors and all the struggle (financial, emotional, on my relationships, etc.) it brings is worth it. At the same time, I don’t see myself working for anything else long term other than those endeavors. I’ve thought many times about quitting “the dream”, but I can’t seem to find something else to fall back on. The positive outcomes of this chase are far and few between lately, but I know they’re out there. I have close friends who managed to “make it”, I know the dream is real and possible because it happened to my closest friends. Am I a victim of the sunk cost fallacy who is blind to it or am I dedicated to my dream/grind?

[@hyx6817]

thanks

[@gendoruwo6322]

i think I suffer this in my stocktrading. So I calc-ed that a stock is undervalue, is good buy, and will go up soon. I buy that stock. The price keeps going down, but I still believe my calc, I buy more. The price keeps going down, I buy more. The price goes up a little, I'm convinced my calc is now coming true, any time now... The price goes down again, I buy more. The price is not going anywhere, I keep waiting. and so on and so on, but it's been a year and I'm still not seeing profit, but have run out of cash. But I've invested so much for so long here, I can't accept that I got this one wrong.

[@demitrivendici]

That's gambling, not trading. Averaging down a stock is one of the riskiest methods in trading. The saying goes, plan your trades and trade your plans. Now where you are going to enter and know where and when you'll take profit.

[@matthewclark1529]

Great video. This is really interesting

[@RishiGangoly]

Superb. Very well said.

[@ShankaDaWanka]

I do not consider your first example to be a sunk cost. You can enjoy a vacation while sick. A cost is sunk when you have no hope for a return on your investment. All of the others, however, make sense.

[@Devils.harp.player]

It depends on the sickness. A cold? Maybe. Food poisoning? I doubt it.

[@ThePeterDislikeShow]

Is there something like a sunk benefit?

[@magnus00125]

i will sit down and appreciate that everybody have tried wasted money before..

[@benjaminn.alemany5300]

Great video!

[@vascoamaralgrilo]

Thanks!

[@peterchen2726]

I think I got the concept, but it wasn't the same until it was paired with the Paint artwork

[@mnk4allcaps]

ty

[@anthonytruong1061]

Not sure if this comment will ever be seen but: I'm a biology grad and struggling to get into physical therapy school. I don't have any debt, but if I do get accepted I'm looking at an additional 3 year investment with 130-200k debt. I'm also talented in sales, and I can start a career with a corporation like Comcast and make 40k per year and move up. Is it obvious what path I should take?

[@stevebean1234]

Anthony Truong my friend is a doctor of physical therapy and like $150k in debt. He made $70,000 a year in Seattle. He became very depressed and became a hoarder. He had to avoid paying rent several times because he couldn’t make ends meet. His car broke down and he had to get a new one and then could barely afford gas. My recommendation is that you should take a year or two to work in the real world. You’ll learn how harsh and brutal it is, how much money you lose to taxes, how much food costs, etc. You could even go get a job as a PT tech. After that, is PT worth the suffering? Sure, it may be 😄. PT school isn’t going anywhere. If it truly is your passion, you don’t have to wait too long. In this regard though, life is lengthy enough for you to take your time. I strongly suggest getting into budgeting/personal finance before making such a huge decision! Even specialist doctors who get paid $500k/yr sometimes would be better off skipping the 10yrs of school + debt and getting a corporate job. I’m an engineer and the ROI is very good. I make a lot of money with little debt. Although, I’m also here for a reason. I’m having a hard time walking away from the salary and my time investment not knowing if there’s anything better that I would enjoy more.

[@anthonytruong1061]

stevebean1234 haha to be fair, Seattle citizens are notoriously depressed due to the weather. But I know what you mean. I spent college working two full time jobs, currently working now for minimum wage and ready to move on doing something with my life.

[@stevebean1234]

@@anthonytruong1061 I loved Seattle. The Seasonal Affective Disorder is real though. I didn't notice much bc I've been depressed forever. One of my good friends there is very active and very happy despite being in law school. So, my other friend's condition probably isn't only the weather. Something to be really cautious of in life: golden handcuffs (or bronze handcuffs, or whatever). Plenty of Physical Therapists are happy with their jobs. But, I currently have my dream job and I'm very unhappy. If I had been saddled down with $150-$200k debt, even though I make 1.5-2.0x more than a PT now, I still would be in debt. I wouldn't be able to leave my job even though I feel like it's compromising my integrity. I think the risk to your integrity (and other personal values) is much lower in the medical field. However, burnout is still real. My friend said PTs are often only paid for 8hrs a day, and they only have maybe 5minutes off between patients. The notes they have to take on each patient, if you were going to do it right, would take longer than 5minutes. So my friend was finding himself working 10hr days, virtually without a break. I'm not trying to discourage you! Just try to be realistic :). If you can find a way to get through school and work at the same time (I'm not sure how possible this is?), or get a scholarship, or work your minimum wage job until you can find a scholarship, maybe that would help :). Definitely; budgeting with realistic numbers (after tax income, health insurance, unexpected problems like car breakdowns, and debt growth due to interest) are all things you might want to look at. Honestly, you probably have way more educated inputs now if you're already working (I can't believe how much money is lost to routine taxes/bills). In summary, the best thing I've done in my career (15yrs working now) is make deliberate, educated decisions; that way, if I'm wrong I can adjust my 'formula' and make even better decisions in the future. One of the biggest challenges I've had in my career is being able to identify and mitigate all the risks - life is so risky. I was homeless illegally living in my garage for a couple months once. And my best recommendation there is to always try to have a backup plan :). Good luck. If you can't tell by the rant, this stuff is interesting to me so if you have other questions let me know....

[@anthonytruong1061]

stevebean1234 right now I am currently interviewing for a job at fidelity. I'm making the leap from medicine into finance, but they are both complex topics that center with helping people. I am hoping I am making the right career choice for myself. Worse case scenario, I end up making a lot of money and continue to pursue medicine lol. What are your thoughts? I have heard of burnout in finance as well

[@stevebean1234]

@@anthonytruong1061 save a lot of money, after you have 3-12mos safety net (depending on your risk tolerance), start investing it. Live well below your means if you can. In stressful high paying jobs, people will begin wasting money and soon become dependent on the huge paycheck. this happens in investment banking - people develop drug habits, buy expensive depreciating cars, or waste money on more of a house/apartment than they really need. Then, perhaps their relationship with work becomes unhealthy but they don't know what else they can do to maintain their lifestyle. my dad was an investment banker and never burnt out to my knowledge - but prepare to sacrifice a lot of meaningful life experiences to the long hours. it can be fulfilling in some ways and depressing in others.

[@TheEmolano]

Nice advice, it's better to lose $200 than $1000, but we don't see those extra $800 until it's gonne.

[@schwarzerritter5724]

Not sure I understand the basketball example. If the player costs more, he is probably more famous and sells more tickets, even if he is not the best player.

[@blindedbliss]

This is not a fallacy... Realising the store is closed today halfway to it and deciding to continue walking towardss it regardless, since you already made it half the way... That's more like it.

[@mariovanderwal1695]

this is a great video

[@MindfulThinks]

Thanks!

[@DiaborMagics]

Explanation is good, but like so many videos it ignores the how. Ignore sunk cost. Got it. But it's ingrained into our psyche and difficult to shake. So HOW does one do that. That is the real question. Knowledge is nice, but it's better to be able to put it to good use. So much advice people have for others comes without the "how", it's annoying. It's easy to say "Do A", or "Don't do B", but include a how, or it really doesn't help much.

[@AurelioPita]

good video

[@MMOStein]

Good vid but that ticket thing was a *really* poor example of sunk cost fallacy.....

[@rckoegel]

I agree, as long as the illness is temporary, avoiding some extreme discomfort does not compare to canceling a trip. I'd take the trip. But that's a judgement based on my personal values, those of another person may differ. I'd suggest that they decide based on their value, not mine, but if they asked for my opinion, I'd offer it.

[@stevebean1234]

Rue Koegel this is how Coronavirus will kill 2% world population

[@BonJoviBeatlesLedZep]

You have the exact same voice of Jan Misali

[@balu.92]

Seems to contradict the notion of perseverance.

[@Emperorbart7]

Learned about this from The Key to Home... idk how I feel about that

[@LimBoholtraders]

I got it 👍

[@SquareRoot_]

Diamond hands ✋💎

[@anthonytorres-cruz1598]

I can't think of a sunk cost fallacy in my life at the moment, but I'm sure there probably is one.

[@2020madeline]

Sick burn on the ad club

[@MindfulThinks]

With love though

[@tomfinn3165]

Went out to a bar for my 18th birthday. Arrived a round late & ID wasn't excepted. Next came in for the beginning of fifth round The waitress hadn't even come by the time the match was over.

[@tomfinn3165]

Wanted to watch UFC fight

[@edwardgaines6561]

Isn't this the same thing as "Law of Diminishing Returns?" I like the video regardless.

[@eunbidraws3778]

Damn

[@AttorneyonaJourney]

Why I quit the law!

[@maxwesmont]

Studying law? How long have you been studying? I am thinking about quitting, too.

[@AttorneyonaJourney]

@@maxwesmont I quit the law 7 years ago and now coach other lawyers who want to change careers.

[@dudemoney4]

Really really sick... To Italy... COVID?

[@rckoegel]

So, just give up on everything right off if it's not perfect for a moment? Got it. Realistically, it's a value judgement; and we all have to make those for ourselves, all the time. Is losing the cost invested worth the cost of sticking with it? And, depending on the issue, if there's a possibility that things can or will improve, how likely is that, and what will the loss be if you risk it and it doesn't improve? I just quit a job that's been going downhill for 12 years, since the company was bought out by an investment firm. The changes the new CEOs made over the years were horrible, over and again, but until a few years ago they only really affected executives directly. Which kinda affected everyone because the company struggled to retain good management. But I liked the work, so I held on to the job until the changes they made were affecting me directly, and there appeared to be no relief from the conflict coming in the foreseeable future. If it were just a bad manager, for example, avoiding them, transfering, or waiting them out, could have all been options. But the problem was systemic and worsening. In a no-longer-desirable relationship, many people hold on 'until' they have an alternative lined up, because they believe the cost of being lonely is too high, and things could improve. But once there's an alternative, staying in the undesirable relationship can lose its value pretty quick. Of course the problem with this behavior is two or three fold: cheating, possibly family issues (kids), and there's also a possibility that if it's not the other party, or only the other party, that's at fault for allowing the relationship to lose it's value. So are they throwing away a valuable relationship for petty reasons, or are they actually leaving a 'bad' relationship?

[@nah9724]

I wanted to like this video but then i saw it had 420 likes and had to be a gentleman and not

[@jackyu3364]

hi RJHS students

[@simonpetrikov3992]

I was never taught this in high school maybe it's because I dropped out after completing 9th grade Due to the malfunction of the online school Note: this was 5 years before covid

[@DarkJak]

Which covid? There's a few of them.

[@zayinmassivi6589]

The sunk cost fallacy wouldn't allow it

[@OlovMetal]

See Fans of Star Citizen

[@MAJE1er]

STAR CITIZEN.

[@mrkoala545]

If only league of legends players watched this

[@ankarm5287]

Any hypixel skyblock players here

[@Jsamul1]

Jesus loves you.

[@BlackAngusReviews]

What a horrible example, take some loperamide and ride the plane you’ll prolly be fine when you land

[@rationalskeptic1]

200 dollars!??? For a plane ticket?? On what planet? Lol

[@jackflanagan9451]

Plane tickets cost anywhere from $20 to thousands of dollars, 200 isn't unreasonable

[@welovelibraries4556]

Wow what a horrible example (plane ticket) for an INCREDIBLE principle “Sunk cost fallacy”

[@rckoegel]

Any example is bad without acknowledging the personal beliefs of the subject. If they value travel enough to be willing to experience, or to risk, some severe discomfort, then talking the trip regardless is a win. If they value feeling comfortable more than travel then taking the trip because of loss aversion would likely be a loss; but it could turn out to not be that bad. It all comes down to values and risk management. It's only loss aversion if you're doing something you wouldn't, or vise versa, in order to avoid a perceived loss, or the risk of one (but that might be better label risk avoidance). And it's only a 'fallacy' if it's an inaccurate judgement of practical value: is it worth loss of life to stay in a abusive relationship because of fear of loneliness, or some other trivial or invalid fear? Is it a fallacy when soldiers are so invested in the ideology of their nation and/or the welfare of their kin that they forfeit their lives for those investments? Or is their sacrifice validated by those investments?

[@brianq2558]

@@rckoegel I'm glad you explained this. ive seen a lot of examples in which the person in question probably should in fact continue doing what they were doing because they would benefit from it in ways unrelated to the "sunken cost", but yet people keep oversimplifying examples and making this concept harder to grasp than it should be

[@vpremeru]

Diction, diction, please.