I was recently listening to a ChooseFI podcast where Alan and Katie Donnegan talk about a concept they call zero-based thinking—the idea of asking yourself: “Knowing what I know now, would I make the same decision today?” It’s a powerful way to fight the sunk cost fallacy—the tendency to hold on to something just because of the time, money, or energy you’ve already put into it. Instead, zero-based thinking challenges us to re-evaluate our choices based on current circumstances, not past ones. It got me thinking about how Katie and I have tried to transition our mindset in this way as we move into our “slomad” stage of life.
Not long ago, Katie was really surprised when I mentioned trading in the Camry she thought I “loved.” And to be fair, when I bought it, it was the perfect fit for me: reliable, fuel-efficient, comfortable, and spacious enough for long solo commutes through downtown Dallas. Same for her minivan. A van with third row seating, leather seats and built in DVD player? Perfect for young kids and road trips… ten years ago. But today? Our lifestyle has changed. What once felt essential now feels excessive. Zero-based thinking forced me to ask: If I didn’t already own these cars, would I buy them today? The answer was no, so we made changes.
Our house is another example of this principle. When we purchased it, we had young kids and jobs in the local schools. The location was perfect—between the elementary and junior high, right next to the neighborhood pool, and just a few miles from work. The four bedrooms and converted playroom suited our family perfectly. Fast forward to today, and our needs aren’t the same. The house still holds memories, but practically speaking, it’s way larger than we need and tied to a location and a lifestyle that no longer reflects who we are. Zero-based thinking asks: If we were house shopping today, would this be the right fit for us?
This mindset also applies to finances. The way we invested during the accumulation phase of life was appropriate at the time—maximizing growth, taking on risk, and planning for the long haul. But as we enter the drawdown phase, the question changes. If I had our net worth in cash right now, would I buy the same investments? Probably not. My risk tolerance and goals have shifted and my investments should follow.
Zero-based thinking doesn’t mean abandoning every past decision. It just means holding your choices up to the light of your current reality. The car, the house, the investments—they all made sense once, but the people we were then aren’t the people we are today (and definitely not the people we’ll be tomorrow).
Maybe the best philosophy is this: Strong convictions, loosely held. Believe deeply in your choices when you make them, but be willing to release them when you have new data or they no longer serve you in other ways.
So what about you—what’s one area of your life that could use some zero-based thinking?
