We’ve all been there, and by “there”, we mean in a sunk cost fallacy relationship. Many people will feel an overwhelming loss at the end of a relationship, responding not only to the loss of the experience, but also to the loss of all of the time, energy, and memories that are a part of that experience with that other person.
If this is the case, the couple may end up staying together because of the time and the memories that they have together, even if it is not the healthiest option for them. Couples in unhappy relationships or bad relationships often stay together because they feel that eventually, their past investment will pay off.
Sunk cost fallacy describes the decision-making process based on “sunk costs”, these past costs being so much time, resources, and effort wasted, specifically in relationships, both romantic relationships and business relationships.
Learning when a relationship may be in this sunk cost phase and how to remove yourself from that situation in a healthy way can be difficult, but it will often be the healthiest option. Learning from failure and a bad past investment and focusing your attention on the future is often easier said than done. This article will examine the fallacy and the impact that it has on relationships, as well as provide some tips to help remove yourself from that situation.
Sunk Cost Fallacy Explained:
The sunk cost fallacy is an economic concept revolving around the tendency for humans to continue to invest in something that they have already invested a significant amount of time or money. Essentially throwing good money after bad in the hopes that they can justify their decision and continue investing. The longer that someone has been working on the investment and the more time and energy they have put into it, the more likely it will be that they will continue the investment, no matter how poorly the investment is performing. This is an example of sunk cost bias toward an endeavor that is the result of time passing.
The sunk cost bias is related to the idea of loss aversion, which states that humans prefer to avoid what is perceived as the greatest loss. Sunk cost fallacy results when the largest loss perceived is the loss of the investment already made in the endeavor. Oftentimes, the sunk cost effect does not take into account any future costs that will be required to continue with the investment and push people to make poor financial decisions.
The sunk cost effect can be found in investments, negotiations, and even relationships, and it can end up impacting major future decisions and costing the person relying on the fallacy a significant amount of time and money if they keep throwing good money after bad.
Learning when and how to keep yourself from falling prey and untangling yourself from a situation that is the result of sunk costs or the sunk cost fallacy is an important skill and one that needs to be identified and encouraged.
Sunk Cost Fallacy Examples in Real Life:
- Gambling or risking more money in an attempt to make up for lost bets
- Sticking with a movie/book/major/job/career even though you hate it
- Staying in an unhappy marriage because you’ve been together for so long but it is no longer serving its purpose
- Staying in a bad relationship with a friend or significant other where it’s unlikely to improve
Impacts on Relationships:
As mentioned above, sunk cost fallacy can find its way into a relationship, particularly a long-term one that has run its course. When the couple needs or wants to break up, the thought of leaving behind the time, effort, money, and energy they have spent on building a life together can cause them to second guess their decision. And oftentimes it can cause couples to double down and invest more time and effort in trying to make it work, even when it is unhealthy or they are incompatible.
The fear of being wrong and ending up alone forces most people to stay in the situations they are in, regardless of any pain and costs already paid. Some common sunk costs examples include:
- Time: One of the biggest reasons that many couples will try and make their marriages or relationships work is the time that they have spent together. Many couples realize that they have spent a significant amount of time with this person that they cannot get back to spend with someone else or themselves. This is the most common reason people stay together.
- Kids: Another reason that many couples may fall into the sunk cost fallacy is that the couple has children together. Children are a decision that the couple chose to make together, and the idea of having to raise them separately can often feel overwhelming. Investing in the children’s lives can be difficult separately as well, so it can often encourage couples to stay together for the sake of their children, even if it is an unhealthy situation.
- Friends: It can be common for those couples who have been together for a long time to have the same group of friends. This can make breaking up hard because it can also involve losing friends that you have worked so hard to connect with. This doubles the sunk cost fallacy that takes effect in this case.
- Assets: Especially if the couple is married, there will often be a large number of assets that they will have to sell and divide. Many couples, will not get a return on the investments that they made on some of the assets, and it can be difficult to imagine attempting to separate these assets and the investments contained in them. Because of this, many couples will choose to stay together instead.
- Memories: Ending a relationship can be difficult because of the number of memories that the couple shares together. It can be difficult to think of all the experiences that you have with a person becoming something that you did with someone who is no longer in your life. Thinking about separating the memories and not experiencing them for ourselves can feel like a lost cause.
Considering the way that sunk cost fallacy can impact a relationship and push couples to waste more time and more resources in an attempt to stick it through rather than amicable separating demonstrates the difficulty and the insidious nature of this fallacy.
Leaving the Relationship & Taking a Loss
Learning how to overcome a failed relationship is not an easy endeavor. There are some considerations and steps that the couple can take to break up healthily and move forward apart.
- Acknowledgment: The first step in most problems is acknowledgment. Couples and individuals need to admit that they would like to end the relationship and move forward, but the sunk cost fallacy is stopping them from doing so. Acknowledging this will help them be able to move forward.
- Confidants: Telling a few trusted people can make the process of moving on easier. They can help encourage steps forward toward leaving while also being a space to process the feelings with. They can help you focus on the future and why leaving is better and potentially help ignore or talk through the feelings of the past.
- Ritual: Often, it is the repetitive reliving of the good memories at the end of a relationship that will push the couple into a sunk-cost fallacy tailspin. To avoid this, it can be helpful to create a ritual where you enjoy the memory once, but then put it to rest through a closure ritual. Doing so will put a hard stop to the repetitiveness of the memory and encourage couples and individuals to remember the good while also acknowledging that leaving is going to be the healthiest.
- Plan: Having some exciting plans for the future can help make the past look less appealing. Booking a vacation, signing up for a new class, or finding a new place to live can help give you something to look forward to and help move past the past.
Leaving a bad relationship or a bad investment is never an easy task. Our resources and time are very limited, so understandably, we never want them to go to waste. But when things run their course and outrun their benefits, it is best to look to the future. Admit the failure and learn from the experience, and more importantly, appreciate the experience. It may not have turned out how you had hoped but it was a necessary experience, usually with an unforgettable lesson.
To learn more about sunk cost fallacy relationships, communication, and more, check out ADR’s blog!