Definition
Worrying that you will miss something, so you buy or do it.
FOMO
You keep a stock that is losing money because you do not want to accept the loss.
Loss Aversion
(Fear of Losing)
Doing something because many other people are doing it.
Herd Mentality
Your friends buy concert tickets, so you buy one too because you do not want to miss out.
FOMO
(Fear of Missing Out)
Feeling worse about losing money than feeling good about gaining money.
Loss Aversion
You spend $100 of gift money easily, but you do not want to spend $100 from your savings.
Mental Accounting
(Different Money, Different Rules)
You look for information that agrees with what you already believe.
Confirmation Bias
You keep watching a bad movie because you already paid for the ticket.
Sunk Cost Fallacy
(Already Spent Thinking)
Keeping something because you already spent money or time on it.
Sunk Cost Fallacy
Everyone at school is buying the same shoes, so you buy them too.
Herd Mentality
(Following Others)
You think you know more or can do better than you really can.
Overconfidence
You are very excited about your new phone, but a few weeks later it does not feel special anymore.
Hedonic Adaptation
(Getting Used to It)
Treating money differently based on where it came from or what it is for.
Mental Accounting
You make money on one investment and start to think you are an investing expert.
Overconfidence
(Too Much Confidence)
Buying something because you think you are getting a good deal.
Transaction Utility
You think a brand is the best, so you only read reviews that agree with you.
Confirmation Bias (Echo Chamber)
(Agree-With-Me Thinking)
Something new makes you happy at first, but after some time, it feels normal.
Hedonic Adaptation
You think your old video game is worth $50 because it is yours, but you would only pay $20 for the same game from someone else.
Endowment Effect
(Mine Is Better)
Thinking something is worth more because you own it.
Endowment Effect
A jacket is $100 but is on sale for $60. You buy it because the discount feels like a great deal.
Transaction Utility
(Good Deal Feeling)