Forget knowing when to hold them - the biggest little secret in life is knowing when to fold them! Cutting your losses as soon as you see the yawning jaws of disaster waiting to gobble you up can make all the difference between bouncing back strong from a loss versus turning that loss into a long term disaster.
Most people have a hard time cutting their losses, and not without good reason. We learn from an early age the moral value of adages such as to never quit, to pursue a goal no matter what obstacles get in our way. Tenacity and persistence definitely lead to strength and victory, and should be embraced. What should be abandoned are paths to your goals which lead to failure and substantial losses.
I get it, it feels wrong to quit on something you've been working hard on, maybe even obsessing toward. You need that business idea to thrive, just keep throwing time and money at it until it breaks through. You really like that girl on Bumble, just keep messaging her until she comes around. You haven't hit Blackjack in nine hands, so this HAS to be the one.
Albert Einstein taught us that the definition of insanity is doing the same thing over and over again and expecting a different result. If we accept this as true, then how can we ascribe virtue to actions we can simultaneously agree are insane? Wouldn't it be better to change our methods until we get positive results?
Avoiding travelling a losing path doesn't mean you quit - it means you decided to try new ways of doing things so you can win. It's the opposite of quitting, and it's a skill to be commended, for not everyone has the courage to back away from a losing hand.
By no means do I claim to be an expert on dodging a mullet, but I have learned a few tricks which have saved me countless funds and time wasted on losing prospects.
First, the fear of missing out (FOMO), that delicious lie our minds tell us to justify sinking resources we can't afford to part with in order to nab something allegedly "irreplaceable," must be overcome in order to live a better life. If you remember one piece of advice from this column, please remember that.
From a material goods standpoint, almost everything that you come across has been mass produced and is readily available for you to find and buy. if you don't absolutely need something, you're not missing out on anything special. If you buy it and can't afford it, you're going to suffer with bills, food, gas and maybe even rent. Worse, the object of your heart's desire will not come to your rescue. Conversely, if you discipline yourself to say no to making the stupid purchase today, you can add it to your wish list. Then you can save up for it, lust after it, then when you're ready, you can HUNT IT DOWN. Hunting is the most fun part of collecting, after all.
Know FOMO, Reject FOMO.
Second, temper the longings of the heart with simple common sense, and don't be afraid to walk away from someone who shows signs of being a bad investment of your heart and spirit. On the asylum podcast, I talked about a recent experience I had on Bumble with a nice lady who I really liked. We had a connection and conversation flowed like wine. We were all set up to have a second date that Sunday. Things seemed to change a bit when a text I sent didn't get responded to until almost the end of the following day. People get busy, no worries. But then, the Sunday morning of the date, I sent a text asking if she was still up for meeting up. 30 minutes, one hour, no response.
Uh-oh.
Fortunately, my sister called. The water at her house was down, and her and my nephews wanted to come hang out while my brother-in-law fixed the plumbing. Not only was this a fine way to have some much needed family time, this provided the perfect escape from what could have turned into a hellish day of waiting by the phone. We had a fun day, and I left the phone behind.
It wasn't until almost five o'clock that I got a text message reading that she had a family emergency and had to look after sister's kids, yada yada yada. She claimed to forget to hit send on the response message letting me know this.
Sure.
Now, I could've tried to reschedule, struck up a conversation talking about family emergencies, etc. But the fact that this late response happened a second time troubled me. So, I decided to simply respond with "It's okay, I hope your family is doing okay." Closed ended, but open enough to where if she really wanted to talk, she could. I effectively wrote it off in my mind. I didn't get any further response, which meant I made the correct call. For whatever reason, she had second thoughts. No hard feelings, she was a nice lady and I enjoyed our time. Moving on.
What's important to note here is how I stayed cognizant of the warning signs throughout our interactions. People talk to people they want to talk to, and don't talk to those they don't. It's sneaky how easy a concept this is, but people miss it all the time. Knowing how many things can go sideways during interactions with the fairer sex, and reminding myself that there are plenty of fish in the sea (REJECT FOMO), I removed myself from the situation in the correct amount of time. Imagine how much time and emotional energy I saved myself by cutting my loasses.
Third, beware looking to get your worth with your investments, for they will continue to drain you faster than you can imagine. This is true for business investments, subscription services, even theme park annual passes. If you don't have the time or money to spend making use of your service, don't force yourself to make use of it simply because you spent money on it.
This is the quintessence of cutting your financial losses. If the business you own keeps draining your money, change up the model. You don't have to buy crap you don't need on Amazon just because you have a Prime membership. If you have Universal passes but don't want to spend $50-$100 going to fight the crowds, stay in. The park will be there next time. (REJECT FOMO)
There you have it, a couple of hard-learned tricks from me on how to cut your losses in everyday tough spots. Keep mentally strong, stay focused, and please, remember at all costs the real title of this article...
REJECT FOMO!
'Til next time, keep your eyes to the skies!
Paul Andrea
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