Downsizing and the Sunk Cost Fallacy
Two of the major obstacles to successful downsizing are the practical and emotional costs of getting rid of “stuff.” We baby boomers have spent years acquiring our stuff and we are reluctant to part with it. I have less of that problem now than I used to. Yet I still struggle with discarding things that to me should have monetary value. If I give my stuff away (or even throw it away), I am losing that value. Thus enters the “sunk cost fallacy.”
An example often used to demonstrate the sunk cost fallacy is the purchase of a ticket to a future event that you really won’t enjoy: Having paid the price of a ticket, should you suffer through a concert or movie that you don’t want to see and won’t enjoy? Or despite having paid the price of the ticket, should you use your time to do something more fun?
The irrational thinkers – those who think about the ticket cost already incurred – will force themselves to attend the concert or movie. To them, it would be “wasteful” not to. That makes little sense because whether you attend or not, the cost has already been incurred and cannot be recovered. Your future behavior should be guided by what is best for you without regard to the money already spent and lost.
This brings us back to downsizing and getting rid of your stuff. What about those old clothes in your closet, that TV in the spare room you don’t watch anymore, or the five tennis rackets in the garage? Whatever decision you make on discarding or giving away an object, it should be based on whatever pleasure keeping that object will give you in the future. Most of our stuff stacked up in an attic, closet, basement, or garage that has not been touched in years is unlikely to give us pleasure in the future. It will only weigh us down when we downsize or move our residence in retirement.
So when you make the decision to keep or discard, forget what the “stuff” cost you. That is a sunk cost. You cannot recover the cost by keeping the stuff. Free yourself from illogical thinking. More important, free yourself from the stuff.
That’s the thought process I’m trying to maintain as I go through years of my stuff. The attic is a challenge to come. Wish me luck!
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