Should you go to a concert you already bought tickets for if you’re feeling miserable? Does the amount you paid matter? I faced this dilemma recently when I held two pricey tickets to see country music legend Junior Brown play at a club a half-hour drive from my house. On the day of the concert, my back was killing me. And I belatedly discovered that I’d purchased tickets to stand for two hours or more. Plus the friend who was going to accompany me had to cancel.
Should I still go to the concert? What if I’d paid $50 for my ticket? What if I’d paid $100? Would it be a complete waste of $100 if I didn’t go?
When you force yourself to do something because you’ve already spent the money—even though rationally you know it’s a bad idea—you are succumbing to what economists call the “sunk-cost fallacy.” People have an inborn drive to keep their behavior consistent with their beliefs, and one of those is, “I don’t throw away money.” Spending big bucks on a concert and then not going mocks that notion. So you go, even though you’re going to be miserable.
Are you wasting time? Or saving time?
You probably hate to waste time too, right? Groups seem particularly susceptible to the fear of time invested and wasted. We see this on our scavenger hunts for corporate groups: a team will spend an inordinate amount of time stuck trying to find the answer to a question, and they can’t bring themselves “cut bait” because it would mean they invested a lot time for nothing. So they keep fishing.
It’s surprising how few teams look at the big picture in that situation: Typically our scavenger hunts last 90 minutes. Let’s say the team had to answer 30 questions in that time. That means on average they should invest three minutes per question. If you are still working on one question after five minutes, you probably should consider moving on to the next one. The time already spent is gone. It’s in the past. It’s a sunk cost. True, you might still find the answer to the question if you keep working on it. But you’ve spent too much to get it.
What sunk costs should you move beyond?
The sunk-cost fallacy, and the fear of having “wasted” time or money, keeps people committed to bad investments, keeps them plugging away in bad jobs, keeps them hoping for a change in bad relationships, keeps them stuck in all kinds of unpleasant situations. Only your interpretation of what the past means about the present keeps you from moving on.
I didn’t go to the concert. Sorry, Junior. Unfortunately my bad back is one sunk cost I’m stuck with.