When Should You Quit? Understanding the Sunk Cost Fallacy

It’s common to hear that you should never quit but there’s actually a great deal of value in knowing when it’s time to keep going and when it’s time to move on.

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It’s a common sentiment that you should never quit. We tell each other and ourselves to “not be a quitter” and that “a quitter never wins and a winner never quits.” But is this the truth?

Here’s how to assess when it’s time to keep going and when it’s actually time to quit.

When Is Sticking with Something Harmful?

As with any ambitions in life, there will be challenges and roadblocks in your way. Most of the time the answer is to stick with it, endure, practice discipline, and grind it out until the end. That’s where the stigma of quitting comes from. But in some instances, the best option actually is to quit, reexamine, redirect, and start anew.

Being gritty—maintaining high levels of both passion and persistence, is only healthy when you are controlling the passion, as opposed to letting it control you. The point at which it significantly hinders other important aspects of your life is when you need to ask yourself whether or not you should stick with it.

It’s easy to let the sunk cost fallacy lead you astray. The sunk cost fallacy states that our decisions are tainted by the emotional investments we accumulate. The more we invest in something, the harder it becomes to abandon it. However, just because you have invested a great deal of time, effort, and resources into something does not mean it will work out.

Hanging on to unrealistic or harmful goals, often perpetuated by emotions and the sunk cost fallacy, leads to misery and missed opportunities. Many of us invest years into pursuing unsatisfying or unrealistic choices because we are afraid to be truly honest with ourselves, and when we realize it too late, we have a midlife crisis and buy a fancy sports car.

Saying winners never quit is a blatant lie, plain and simple.

 

1 | Know Yourself

The first step in knowing whether or not to quit or to persist is to know yourself. Are you the type of person who easily quits something, or are you the type of person who has a track record of sticking with something longer than you really should?

Be honest. Most of us fall into the first basket, which is that we easily quit something in response to resistance. In times like these, it’s important to give it a chance. If you just started a new job or school, don’t let the adjustment period and associated stressors get you off track.

 

2 | Separate Hardship From Learning

Some of the best and most effective learning occurs when you struggle, deal with an obstacle, and learn how to overcome it. There’s a fine line between struggling and learning a great deal versus struggling and giving up.

The next time you are struggling and want to quit, ask yourself the following questions:

  1. “If I knew what I knew now, would I still pursue this project or goal, or would I do something different?” If your answer is “hell no” or “what in the world was I thinking,” then your next question should be…
  2. “Why am I still doing this?” It’s often due to sunk costs and overvaluing what you have done due to an emotional connection you may not be acutely aware of. The endowment effect says we ascribe more value to things merely because we own them.
  3. The next question to ask yourself is “do I still believe in the vision?” If the vision still gets you excited, if you still get giddy thinking of helping sick children in the hospital, if you believe what you’re working towards will help you truly make a difference, if you can’t imagine doing anything else other than achieving this goal, then don’t give up. This is your time of being tested. You’re experiencing the dip.

 

3 | Understand “The Dip”

The premise of Seth Godin’s book The Dip is the following: Things that are scarce are more valuable. To create something valuable is difficult; otherwise, it would not be scarce. Lots of people start a project, hit The Dip, and then quit. But The Dip is often your time of being tested.

We all know how millions flock to gyms in January as part of their New Year’s resolutions. How many are still there in the fall? Those who endured The Dip are reaping the rewards of better health and better physiques.

During my undergrad, a few thousand students were premed in freshman year. At graduation, only a couple hundred actually applied to medical school. Those who endured the rigors and passed through The Dip were the ones who moved on to the next stage of their medical training.

Deciding not to quit does not mean you should just “try harder,” “endure,” or “suck it up.” Deciding not to quit means you were simply pushed to the brink and decided to come back and work on this goal of yours.

If you want to quit, something clearly is not working for you. So sit down and figure out how you can be more resourceful, more efficient, and more resilient so that you don’t get pushed to that extreme again.

Are you inefficient at studying? Are you unable to get proper sleep? Is your energy low because you don’t eat healthy and aren’t prioritizing exercise?

 

4 | Look Back at Your Progress

Persistence alone does not guarantee success. To differentiate between when something is a Dip or a Dead End, it often helps to look back at your progress. If you see your grades are improving, you’re making gains in the gym, or your body fat is decreasing, then that means you’re headed in the right direction.

If you’re not progressing how you should, re-evaluate your situation. That doesn’t mean drop everything and sulk in the corner. Find ways to improve your current methods.

Several small tweaks can create dramatically different results.

 

Sometimes Giving Up is Actually Moving On

We should be gritty, not stupid. Don’t give up too easily, but at the same time, don’t hold on just because you’ve put in a lot of effort. You must be willing to adapt to find success. These are tough and scary decisions to make, but remember that there’s no shame in quitting. There’s actually a great deal of value in making a logical and honest choice.

It’s not giving up. It’s moving on.

If you’re struggling to decide whether or not to quit something, check out our guide:

How to Make Tough Decisions — 7 Strategies for Better Decision Making.

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