My trusted pickup was feeling rather loose on the highway so I took it to my trusted shop. Turned out the front end was in rough shape. Along with some servicing, brakes and odds & ends it was just over $2000.
Two weeks later I pulled out from a lunch meeting and the transmission failed.
Rough estimates were $2000 for a used transmission installed, $3000 for a rebuilt and $4000 for brand new.
Now, I need to tell you that my trusted pickup (sometimes referred to as The Beast) is a 2002 Ford F150 with 370,000 km on it.
If I had been asked a month prior if I would rather spend $4k plus on repairs or put those same dollars toward a new(er) vehicle, I would have opted for the latter.
But the first $2k was a no brainer for me. The engine is in fine shape and the body has only hints of rust along the lower edges. That amount of money to give me another 6-12 months was well worth it.
And, the second $2k was also a no brainer for me (I opted for the used transmission since they had found a pretty decent one.)
When the transmission went, I had a good pickup with a solid front end and good brakes that needed a new transmission to get back on the road. Is a pickup like that worth $2k? For me, yes.
The first $2k was at that point irrelevant, it was already gone, a sunk cost.
Learning to ignore sunk costs, not just in money but in time, has been a very useful decision making principle for me.
I was recently approached by a friend/client to finish off and then market a large online training program he had spent a significant amount of time developing. I suggested some market research first, because while the issue he was addressing is widespread and acute, it wasn’t clear to me that people would seek to address it by purchasing a course.
It quickly became apparent that there was an excess of free information online, even from high authority government sites. Not the best context in which to sell a premium product.
In the end, we squelched the project despite his investment of thousands of dollars’ worth of time and money. It was all sunk, gone anyway. No sense spending several thousand more to market it when the research indicated a no-go.
Here’s the question to ask of any project or item you have already spent money on: Given what it will cost from this point on to bring this to completion, is it worth it? (That “worth” is not always money, but you still need to define it in concrete terms of the outcome you desire.)
The answer might be yes and it might be no. And it might not be what we want to hear. It can be hard to do what makes sense due to our prior emotional investment. But leaving those sunk costs behind and deciding to abandon or complete a project based on its present merits will help us make better decisions.
Now, if the motor or the backend on The Beast goes, there won’t be a follow up post, just a video of a bonfire…