Massage & Bodywork

SEPTEMBER | OCTOBER 2021

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14 m a s s a g e & b o d y wo r k s e p te m b e r/o c to b e r 2 0 2 1 best practices | BLUEPRINT FOR SUCCESS The Sunk Cost Trap Throwing Good Money After Bad By Allissa Haines and Michael Reynolds The sunk cost trap, also called the sunk cost fallacy or bias, describes our tendency to irrationally follow through on an activity that is not meeting our expectations. You've probably heard the phrase "throw good money after bad"—that's referring to the sunk cost trap. This trap may apply to actual money, time, or emotional effort. The best example of the sunk cost trap is an automobile. When you buy a car, you'll eventually have to put a certain amount of maintenance into the vehicle—and eventually bigger and more expensive things need to be fixed. A few years back, I bought a car and put in the usual amount of maintenance in the form of oil changes, brake pads, and new tires. But new problems kept popping up. Then, a warning light came on, and I thought, "I really need to just start looking into getting another vehicle." But then, in my head, all I could think about was how I just spent a wad of cash on those new tires. I don't want to trash the car now. The sunk cost trap is the feeling that I put so much money, time, or effort into this situation that I don't want to let it go yet; I want to keep trying. I finally got rid of the car after it died and left me stranded. The whole situation was a hassle, but it taught me an important lesson: sometimes you just have to let it go. The sunk cost trap happens in businesses too. Years back, I expanded my office and added a dual-use yoga and workshop space. I hustled for nearly three years to make the space cover its costs and make me a little money for my efforts. It was not fruitful. I had the whole sunk cost trap conversation in my head. I thought about all the time and love I put into the expansion, as well as the cost of the physical construction and furnishings. It was really hard to reconcile myself to the reality that I would not get that money and time back. Over the course of six months, I discussed the issue with colleagues and friends. I was planning to give it a few more months of trying when I was presented with an opportunity to let go of the space under the best possible circumstances. So, I let it go.

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