Commitment, Consistency, Loss Aversion

Andrew Luck risked millions of dollars to pursue a more meaningful and satisfying life. Are you willing to do the same?

Commitment, Consistency, Loss Aversion

By Starla

August 28, 2019

 Minute Read

Someone asked last night what I did for a living.

Without hesitation, I replied, "I help people make the tough decisions in life that can be career and life-altering. Decisions like the one Andrew Luck just made - based solely on what makes life satisfying and meaningful FOR THEM and not on what the rest of the world thinks should be important."

Harvard did a 75-year study on fulfillment. They wanted to understand the themes of people who were most fulfilled in life. One of those themes is that they faced (head-on) the big and difficult questions in life. If that's the case, why doesn't everyone tackle the big and difficult questions in life, especially when living a satisfying and meaningful life is on the line?

The explanation is relatively simple: humans are naturally inclined to maintain consistency and avoid losses.

01

Commitment & Consistency

the need for subsequent behavior to justify previous decisions & commitments

Humans have a nearly obsessive desire to be - and to appear - consistent with what they've already done or decided. Once we commit, the need for consistency will cause us to think and behave in ways (sometimes irrational) that justify our previous decisions and behavior.

This bias toward ongoing commitment can then cause us to fall victim to the sunk cost fallacy - continuing a behavior or endeavor as a result of previously invested resources (time, money, or effort) even though the behavior or endeavor may not make sense or serve us well anymore.

02

Loss Aversion

potential losses loom larger than potential gains

Social Psychology believes that the pain of losing is psychologically twice as powerful as the pleasure of gaining. Because of this, people are more willing to take risks to avoid a loss than to acquire an equivalent gain.

Sadly, this can often keep us from reaching our highest potential. Time and time again, I watch incredibly talented people with unlimited potential fall victim to this. Fortunately, Andrew Luck did not.

Andrew's commitment to play in the NFL, and the sunk costs associated with it, did not hold him back from deciding to pursue a different path that will likely:

  1. be more intellectually stimulating and satisfying for him, and
  2. allow him to have far more impact in the world than if he were to remain in the NFL.

Who knows. It's difficult to predict with 100% certainty, but that is a risk he is apparently willing to take. Andrew could have chosen to stay in the NFL and avoid the painful loss of millions of dollars in income - which he may or may never replace, depending on the path he takes. But then again, who knows! It is a risk Andrew is willing to take for the potential gain of enjoying a much more satisfying and meaningful career in the long run.

SIDE NOTE: Being a slave to money and convincing yourself you must chase it is a choice.

  • Are you allowing prior decisions & commitments (and your need to stay consistent with them) to drive you down a path that is no longer important to you or in alignment with your goals and vision for life? 
  • Are you allowing an overstated or irrational aversion to loss hold you back from self-authoring a life that will allow you to be more, do more, and have more of what is truly meaningful for you?
  • If so, how have you been complicit in engaging in this behavior - either consciously or subconsciously? What thought processes or internal dialogue have elicited this behavior?
  • What's your reaction to this, and how do you feel about it?
  • What do you ultimately want for yourself, and how would you think and behave differently if this is what you truly wanted?

Ponder on that, my friends, and let me know what questions you have. Tweet me, or shoot me a message on Facebook or LinkedIn.

Comments or Questions?

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