What are sunk costs? In simplest terms, it’s the amount of money (or time) you’ve sunk into something.
After reading these two author’s posts, I started to think more about garage sales and sunk costs.
We contributed to a family garage sale last week, and while it did make us a little extra spending cash it also made me much more aware of sunk costs and their impact on my attitude.
It’s very easy to get caught up in what you originally paid for something.
Here’s an example of something that I heard during the pricing of garage sale items.
“What? You’re selling that for $2? We paid $30 for that and it’s practically new!”
The key isn’t to think about how much you spent on the item originally, because that money has already been spent.
The fact that you’re not using the item and no longer want the item, means that it is essentially worthless to you.
In fact, the item actually costs you because you have to store it and maintain it. Too many items like this can cause stress-inducing clutter.
Once you ignore the sunk costs, it becomes easy to part with things. In fact, we actually donated a lot more than we put into the sale because it simply wasn’t worth the time it would take to price everything.
I feel good knowing that I helped some other frugal bargain hunters score a deal either at my sale or at the local charity thrift shop.
No more guilt over sunk costs.