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August 9, 2021

Cut Your Losses

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This is some advice you’ve probably received before, but it's for good reason. The advice is to cut your losses. In personal development there are two sides to the coin. First it’s important to know what to do, and what’s working for you in your life. But that will only get you so far. You also need to know what not to do, and when things aren’t working. You need to have the self-awareness and humility to know when something isn’t serving you. You also need the courage to actually do something about it, which is unnatural but all important.

Psychologically we have a tendency to hold onto previous investments we’ve made because we don’t want to accept loss. This is called sunk cost bias. It’s a phenomenon where you’ve put so much into something that you just can’t let it go. But the unfortunate part is, the longer you hold on the worse outcome you’ll get.

That’s why they call it cutting your losses. Imagine a loss as a thread that’s sticking out of a shirt. You could refuse to acknowledge the problem, ignore it, and hope that the thread will fix itself. But as we know an exposed thread will get snagged on something and stretch even longer. Bt if you cut the thread (aka your losses) then you have a solution and the problem won’t get any worse.

This came to mind because there’s a book I was excited to read that I  wasn’t enjoying. So I chose to cut my losses, I won’t finish it, and instead I'll pick up a different book. Things aren’t going to be perfect all the time. That’s okay! And as long as you have the presence to know when things aren’t working for you, then you can make an adjustment.

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