To decide on a professional commitment, ask yourself if you'd still do it if you knew it would take twice as long and be only half as rewarding. This mental model effectively filters for high-conviction tasks by forcing an evaluation of their true opportunity cost and intrinsic value, making it easier to decline non-essential work.

Entrepreneurs often get burned by a failed investment (like a bad ad agency) and become hesitant to invest in that area again. This is a cognitive trap. The first loss was the money spent; the second, more significant loss is the opportunity cost of not trying again with a better strategy.

To fight professional inertia, ask yourself a simple question: "If my current project ended today, is this the exact thing I would choose to start again tomorrow?" If the answer isn't a clear "yes," you're likely operating on momentum, not conviction, and it's time to change course.

To decide whether to sell a long-held asset you're attached to, imagine it was sold overnight and the cash is in your account. The question then becomes: "Would you use that cash to buy it back today?" This reframe bypasses status quo bias and the endowment effect, making the correct decision immediately obvious.

Gaonkar admits a major mistake wasn't just selling NVIDIA too early, but failing to re-evaluate it later. The sunk cost bias makes it psychologically difficult to revisit past decisions, especially ones that were wrong, causing investors to miss out on significant future gains.

The common advice to overcome sunk cost fallacy—"imagine you didn't own this, would you buy it today?"—is ineffective because you cannot truly ignore the reality of ownership. A more robust method is setting pre-commitment contracts or "kill criteria" that force a decision when specific signals are observed.

Don't focus on making perfect decisions upfront. Instead, cultivate the ability to quickly reverse a bad decision once you recognize it. The inability to tolerate a known bad situation allows you to cut losses and redeploy resources faster than those paralyzed by fear or sunk costs.

Once people invest significant time, money, and social identity into a group or ideology, it becomes psychologically costly to admit it's wrong. This 'sunk cost' fallacy creates cognitive dissonance, causing people to double down on their beliefs rather than face the pain of a misguided investment.

To combat endowment effect and status quo bias, legendary trader Paul Tudor Jones advises viewing every position as if you were deciding to put it on today. This creates a zero-based mindset, forcing you to justify each holding's continued place in your portfolio.