A 24-year-old male client in therapy tells me: “My first year of business school has been terrible for my mental health. I have panic attacks; sleepless nights and I constantly feel unhappy. I hate the course. I wonder if I must quit the course and pursue what I like but now that I have invested time, and energy and completed one year, maybe I should continue. I don’t know if I am making the right decision, I feel I am continuing for the wrong reasons and making myself suffer.”
Very often clients reach out when they feel stuck or experience dissonance in decision-making. Sometimes their reasons for choosing to stick with something or quit can be understood better through the concept of cognitive bias, which may be unconsciously at play.
Sunk-cost fallacy is one of those biases. In 1985, psychologists Hal Arkes and Catherine Blumer defined it as “a greater tendency to continue an endeavour once an investment in money, effort or time has been made”.
In other words, people persist with tasks or relationships, even when they are dissatisfied or unhappy, because of the investments they think they have made—and despite knowing that the gains, if any, may be limited. This fallacy can be seen across situations such as unhappy relationships/marriages, financial investments, education, and even persisting with a series on an OTT platform even though you don’t like it.
The reality is that all of us are at risk of falling for the sunk-cost fallacy in some aspect of our lives. There are various factors that make us susceptible.
The first is our irrational ideas about grit and resilience, the belief that we must not give up even if the losses outweigh the profits. This shows up in the form of commitment bias.
We may believe that quitting or not completing what we started is a weakness. I have grown up hearing that once you set your mind to something, you must finish it. What we are not told is that sometimes our goals begin to control us, even if our heart no longer feels the joy or happiness.
Human beings inherently want to avoid experiencing losses; sometimes, then, letting go of a goal is harder because the “what if” scenario plays out in our heads and we may not be able to see the gains that lie ahead. Our fear of starting afresh can lead to an inertia of its own kind.
How we judge ourselves and how society perceives us also impacts our choices. At the same time, most people don’t want to be perceived as being wasteful, so our choices are also a function of that.
Becoming aware and not judging ourselves every time we fall for the sunk-cost fallacy is the first step. At the same time, it’s important to recognise, as author and psychologist Susan David says, when we need to quit and when we must grit.
We need to recognise that stretching ourselves even at the risk of losing ourselves is not resilience.
It’s okay to pause, regroup and even change course so that we may find a new path, which feels more authentic and in sync with our thoughts and feelings. Sometimes, finding what we desire or really enjoy means going through steps/processes that didn’t work. It’s okay to acknowledge this.
The process of decision-making is complex, with various moving parts, so it’s important not to quit impulsively but to make informed choices that allow us to become mindful of our tendency to fall for cognitive biases.
My experience in therapy tells me that knowing about the fallacy is not enough. The client needs to hold space for ambivalence, and this requires the time, patience, courage and self-compassion to re-examine choices.
The final decision is one that the client feels cognitively and emotionally ready for—and one that comes from a space of informed choice.
Sonali Gupta is a Mumbai-based clinical psychologist. She is the author of the book Anxiety: Overcome It And Live Without Fear and has a YouTube channel, Mental Health With Sonali.