In partnership with

Welcome to another edition of the 1% Habits Newsletter!

This is where you’ll get up-to-date information on small wins to improve your habits, productivity, and life satisfaction. 

Let’s get to it.

— SPONSORED AD —

Stay up-to-date with AI

The Rundown is the most trusted AI newsletter in the world, with 1,000,000+ readers and exclusive interviews with AI leaders like Mark Zuckerberg, Demis Hassibis, Mustafa Suleyman, and more.

Their expert research team spends all day learning what’s new in AI and talking with industry experts, then distills the most important developments into one free email every morning.

Plus, complete the quiz after signing up and they’ll recommend the best AI tools, guides, and courses – tailored to your needs.

Sign up to start learning.

— END SPONSORED AD —

📈 How to Make Better Choices (Without Letting the Past Hold You Back)

Let me open with two quick stories—one where I learned a lesson early, and another where I learned it the hard way.

One of my earliest memories is going to see a “Cheech and Chong” movie with my dad. (Let’s ignore for a moment how odd it is to take an 8-year-old to a movie filled with cursing and pot jokes.)

About halfway through, my dad stood up and said we were leaving. I was confused—why would he “waste” his money by not staying for the whole thing? On the way to the car, he told me, “The money’s already spent, so why make it worse by sitting through something that’s not any good?”

In other words, he didn’t see the point in throwing good time after bad.

Fast forward to 2012, when I first started dating my wife. We had just returned from hiking the Grand Canyon and staying at the famous Phantom Ranch, where we enjoyed their legendary “Hiker’s Stew.”

Wanting to impress her, I decided to recreate the stew at home. Unfortunately, I misread the recipe and added tablespoons of clove instead of the recommended half-teaspoon.

The result?

A clove-flavored disaster.

But instead of tossing it, I forced myself to eat as much as I could, just because I didn’t want to “waste” what I’d made.

Both of these moments are classic examples of the sunk cost fallacy.

My dad had the right approach.

I… definitely did not.

What is the Sunk Cost Fallacy?

The sunk cost fallacy is a common mental trap where we continue investing time, money, or effort into something simply because we’ve already invested so much—even when it’s clearly not working out. Rather than cutting our losses, we “double down,” hoping to justify what we’ve already spent or done.

It’s the feeling of “I’ve come this far, so I might as well keep going”—even if going further just means more pain, frustration, or wasted resources.

— SPONSORED AD —

Imagine having all the tools you need to build small, consistent habits that lead to big changes over time?

With the whole Store Bundle, you’ll get an all-in-one collection of over 100 premium printables designed to help you master the art of building 1% habits.

Unlock your best self—one small habit at a time. The Whole Store Bundle gives you instant access to 150+ printable planners, trackers, and journals, so you can organize your life, crush your goals, and stay motivated every single day!

— END SPONSORED AD —

Real-World Examples of the Sunk Cost Fallacy

Here are a few places where this fallacy often shows up in everyday life:

● Movies and Books: Forcing yourself to finish a bad movie or book just because you already paid for it or got halfway through.

● Relationships: Staying in a friendship or romantic relationship long after it’s stopped being healthy, simply because “we’ve been together for years.”

● Careers: Sticking with a job you dislike because you’ve already spent years in the field or invested in a degree.

● Projects: Continuing with a business idea or side project that’s clearly not working, because you’ve already poured time and money into it.

● Memberships and Subscriptions: Continuing to receive monthly subscription boxes, magazines, or online services that no longer interest you, simply because you’ve already paid for several months in advance.

● Food: Forcing yourself to finish a meal you don’t like (hello, clove stew) because you don’t want to “waste” food or money.

How to Break Free from the Sunk Cost Trap

If you want to avoid falling into this mental pit, here are five steps to help you make better decisions:

1. Acknowledge the Investment

Start by honestly recognizing what you’ve already put in—whether it’s time, money, effort, or emotion. It’s natural to feel a sense of loss or regret, but remember: those resources are already spent. Nothing you do now can recover them. Accepting this reality is the first step toward making smarter decisions going forward.

2. Focus on the Future, Not the Past

Instead of asking, “How do I justify what I’ve already spent?” ask, “What’s the best decision for me from this point forward?” Imagine you’re starting from zero. Would you choose to continue, or would you walk away? The only thing that matters is whether sticking with it will actually improve your situation—regardless of past investments.

3. Set Clear Criteria for Stopping or Changing Course

Before you start a new project, relationship, or commitment, define what “enough” looks like. Set boundaries or milestones that will help you objectively decide when it’s time to reassess. For example, “If I’m not enjoying this book after 50 pages, I’ll put it down,” or “If this business isn’t profitable after six months, I’ll reconsider.” This makes it easier to step away when the time comes.

4. Practice Letting Go in Small Ways

Build your “quitting muscle” by starting with low-stakes decisions. Don’t force yourself to finish a bad meal, movie, or book just because you started. The more you practice letting go of small things, the easier it becomes to walk away from bigger commitments when necessary. Over time, this helps you become more comfortable with change and loss.

5. Reflect and Learn for the Future

If you do find yourself falling for the sunk cost fallacy (we all do sometimes), take a moment to reflect. What emotions or beliefs kept you stuck? What could you do differently next time? Use every experience as a learning opportunity to get better at making decisions that truly serve you.

Final Thoughts

The sunk cost fallacy is one of the most common traps we all fall into—and it’s not always easy to spot in the moment. But if you can learn to recognize it, accept what’s already gone, and focus on what’s best for your future, you’ll free yourself to make smarter, braver choices.

Sometimes the strongest thing you can do is let go and move on. Your time, energy, and happiness are worth more than any sunk cost.

Talk soon,

Steve

📺 Today’s Featured Video

The featured video, Get 1% Better Every Day, explores the powerful idea that small, consistent improvements add up to massive results over time. The video breaks down how focusing on getting just 1% better each day—whether in your habits, skills, or mindset—can lead to exponential growth. Instead of chasing overnight success, the key is to embrace steady progress and trust that these tiny gains will compound, ultimately transforming your life. If you’ve ever felt overwhelmed by big goals, this video is a great reminder that lasting change starts with small, daily actions.

📰 Newsletters You Might Like

☕ Techpresso: Techpresso gives you a daily rundown of what's happening in tech and what you shouldn't miss. Read by 300,000+ professionals from Google, Apple, OpenAI...

👣 Deep Walks: The newsletter for deep thinkers. Perspective-changing quotes, reflections, and essays on everything from world religion to ancient philosophy.

🎯 How Brands Win: Discover the strategies behind iconic brands. Get their famous "7 Positioning Sins That Cost B2B Brands Millions" guide when you join.

🗂️ The Resource Roundup

😡 Needless Stress: Why We Create It and How to Stop: A practical reminder that much of our stress is self-inflicted, with actionable steps to simplify your life and reduce unnecessary worry.

⚙️ The Paradox of Productivity: An exploration of why working harder doesn’t always lead to better results, and how embracing limits can actually make us more productive.

🌱 31 Signs of Emotional Maturity: A helpful checklist of traits that signal emotional maturity, with practical insights for anyone looking to grow in self-awareness and resilience.