Explaining the sunk cost fallacy and what you can do about it
“Do you ever feel like a plastic bag? Drifting through the wind. Wanting to start again?”
I certainly hope your answer to the first question is no. What did Katy even mean by that? Nonetheless, I’m sure you’ve felt a “wanting to start again.” Felt it. Then thought—well—I’m already here, so I may as well stick it out. Here are a few scenarios where this thinking might have played out:
- Despite realising 5 minutes into a Netflix movie, the entire budget was spent on paying Jason Mamoa, and the trailer told you everything you needed to know; you sit through the entire 1 hour and 50 minutes.
- Even though the first bite of the $8 muffin from the Shaky Isles counter in the Engineering building sucked all the moisture from your mouth, including the saliva from your salivary glands, you force yourself to finish it.
- Halfway through your degree, the thought of one more class has you internally screaming and drafting a post for UoA Confessions every other week. Yet, you carry on to the bitter end.
The sunk cost fallacy is a common but flawed way of thinking. It’s when we decide to complete something only because we have already spent time or money on it, and not because the benefits of persevering will outweigh the costs. We tell ourselves to keep on keeping on even though it makes us wish we were a plastic bag. But a biodegradable one, so we can get the shit over quicker.
The reason this thinking is flawed is because no matter what we do, there’s no way to get the resources back. The one, two, or three years you’ve spent studying (and the student loan to go with it) is gone, regardless of whether you end up with that degree or not. What we should be doing is making decisions based on what will bring us the best future outcome.
Of course, it’s hard to figure out whether you don’t like something enough to justify not completing it, especially when other things keep you on the fence. For example, “every year without fail,” Flora considers dropping out of law. However, coming across “cool lecturers”, enjoying a particular paper, and the hope of ending up with a “decent job” convince her to hold on. No one can doubt the sense of security completing degrees with clear graduate outcomes like law, med, and engineering offer, so how can we find clarity?
In search of reassurance that the tears spent over first-year health science papers won’t go to waste if I don’t apply for post-grad med, I talked to Liz Barry. No. Not Hilary Barry’s sister—I checked—but a person who’s just as iconic. She’s a careers consultant both privately and at CDES.
Uni students go to Liz all the time asking whether or not they should stay in their programmes even though they don’t enjoy them. Her answer: “It depends.” If you’ve got one semester left, stick it out. Even if you know you don’t want to work in that field, Liz says, “All is not lost.” Employers don’t just look at what degree you’ve done and call it a day;
“The degree may unlock the door […], but it’s your employability skills that push the door open into that job, it’s who you are as a person and what you’ve done alongside your studies that make you more employable.”
Liz isn’t lying when she says your English degree doesn’t mean you have to become an English teacher. She has an MSc in pharmacology, but it’s her job as a career coach that gives her life purpose. At the end of the day, the bare minimum you can take away from a degree is learning what you don’t like doing.
According to Liz, most people she sees stay in their degrees and careers because they don’t know what else to do. If you’re in this position, Liz suggests taking some time out from uni or spending time once you’ve finished your degree to explore the world of work. She’s a big advocate for taking gap months or years and giving yourself space to think or try something new. Liz said that if she had listened to the following quote someone shared with her at 21, there’s no way she would’ve spent time cutting up “genetically hypotensive rats” for her thesis:
“Here is Edward Bear, coming downstairs now, bump, bump, bump, on the back of his head, behind Christopher Robin. It is, as far as he knows, the only way of coming downstairs, but sometimes he feels that there really is another way, if only he could stop bumping for a moment and think of it.”
In saying this, Liz believes you don’t need a gap year to figure out what you would rather be doing. The first step in her career decision-making process is “soul search”. Ask yourself what skills would you rather be using and “what you yearn for”. Look at the things around you, such as the books you’re reading or the people and events you’re following, for clues as to what you’re passionate about and interested in. Liz says, “Curiosity is a meta-competency,” and it can be exercised alongside studying through working part-time or volunteering in industries that interest you and talking to people who have jobs that you think you might like.
Research also suggests that if you imagine that you don’t have much longer to live, or perhaps that you’re about to be thrown into another Level 4 lockdown, we’re less likely to pay attention to the sunk cost fallacy. Alternatively, you could ask yourself what you would do if the thing you’re doing is free. We’re much less likely to finish something we don’t enjoy when we haven’t paid for it. Taking these suggestions might help you with “soul searching”. If not, I’m sure Liz or another advisor at CDES could help. So, book that free appointment already!
The sunk cost fallacy needn’t keep you from trying new things and following your interests. I know it’s easier said than done to give yourself permission to just spend another 20 minutes choosing a different Netflix movie or taking a break from a course that’s not working for you. But choosing happiness isn’t quitting, it’s winning.