3 Mental Areas That Stop Us From Making Good Decisions

We all strive for something universal: Making good decisions. Some are easy to make and come from our subconscious mind, while others require a little more effort. The decisions that need more from us are often emotional and confusing choices. I’d like to view myself as a rational person, but truthfully I’m not. You’re not. You may not have been one to panic buy during a pandemic, but I’m sure there’s a time when you filled up your trolley with groceries you didn’t need. At some point in our life, we have all made irrational choices. And like the rational decisions we make, some illogical resolutions we choose are subconscious. What is it about human behaviour that makes it so easy for us to become irrational?


making good decisions


We continuously believe others should share our views. It’s why we talk so passionately about a movie we like or a project we’ve been working on. When we see the world through our unique lens, we naturally dismiss other people’s beliefs. Consider these examples:

“I can’t believe our client struck a deal with our competitor instead of us.”
“You’re vegan? Missing out big time.”
“You eat meat? You’re killing the planet.”
“I can’t believe they won that match. The referees helped them win!”

It doesn’t matter which side of the fence you’re sitting on; there’s someone out there who thinks our opinions and thoughts are irrational. So why is it we make bad choices when we seek to make good decisions?


1. Survivor Bias


Humans tend to study and consider successful outcomes of others and ignore the failures that go with it. For example, in World War II, the American military asked mathematician Abraham Wald to study the best way to stop airplanes from being shot down. The military knew they could use armour as a form of protection but couldn’t protect the whole plane and could be too heavy to fly. The plan initially was to examine all planes returning from combat and see how bad they were hit and reinforce those areas. Although the returning aircrafts were inspected, the American military failed to examine the planes that didn’t return. As a result, the military armoured up the wrong parts. They focused on the areas that allowed the aircraft to keep flying after being hit instead of inspecting what would shoot the plane down.

When you get clear about what survivor bias is, it can become clearer to mitigate the effects.


Modern Day Examples


-A newbie buying stocks based on trends. Investors buy based on the current market trend where the new investor might try to replicate it, expecting the same result. Because investors have a more in-depth insight and strategies, the new investor fails to look at other factors, where the factors influencing success may have changed.
-The media. When you read articles like “Get a Ripped Body Like Chris Hemsworth” or “How to Be a Millionaire Like Oprah”. There might be thousands of people out there employing the same strategies as the celebrities we read about, but we forget about the other regular people who work just as hard and achieve results, but aren’t in the news.

With survivor bias, your mind can trick you into a narrow thought process. Next time you come across making a decision based on one external example, ask yourself, “Am I looking at all factors, through all lenses?”


2. Confirmation Bias


When we look for information that supports an existing belief, we have the tendency to make bias decisions and reject new data that goes against what we believe. For example, in 1998, Andrew Wakefield’s study linked the measles vaccine to autism. It was retracted from the British Medical Journal in 2010 after evidence was presented that Wakefield manipulated the data. His confirmation bias powered his aspiration to establish a link between vaccination and autism. The claim is still disproven today, and it remains a topic of discussion in the medical world.

It’s not natural for us to form an opinion and test it differently to prove it false. It’s more likely for us to prove it true and use information that surrounds us to support it. We prefer the information we seek to be validated rather than new.


3. Anchoring Effect


When people make decisions, they can tend to rely heavily on the first piece of information they learn. They use that information as an anchor or focal point in which choices are made. For example, several studies have demonstrated that when a lawyer recommends a prison sentence to a criminal judge, it significantly affects the judges’ decision. When given an anchor (i.e. ten-year sentence), they’re more likely to prosecute a higher prison term. It goes to show that even experts in their fields do make decisions from anchoring.

Here are some everyday examples that may impact your decisions:

Petrol Prices

The national average price for petrol in 2003 was roughly 90c per litre. People were used to paying that price, but the national cost crept up over the years and consumers had to adjust their anchor. In 2020, the price of petrol increased to 142c per litre. Consumers would consider this expensive, but if they got fuel for 120c, it would be a bargain. At one point, people thought paying more than 90c was ridiculous, but years later, they are happy to pay 120c. It shows that their mental anchor in the context of price played more of a factor than the price itself.

How much TV should your kids watch?

If you didn’t watch much TV growing up, you might have an anchor point of how much your children watch. Your decision may be only 1 hour a day, but for someone who watched TV morning and night, they might allow 3 hours.

Negotiating your salary

Research suggests if you are negotiating your salary with your boss and be the first to layout your recommendation, you might have the edge. Whoever makes the first offer has the anchor price, which essentially makes that the starting point. The first offer helps establish counter offers around the figure you have anchored, increasing your bargaining power.

Buying a House

You read online that the average house price in the area you’d like to live in is $550,000. You see a couple of homes you like, and you put down an offer for $525,000 on one of them. It’s accepted, and you’re happy with it because it’s $25,000 less than the asking price. Except, the other house you like just sold for $495,000 in the same area that you liked just as much. Afterwards, you might be left wondering why you made such a quick decision to put an offer on the first house rather than shop around more.


Moving Forward


Rather than thinking of these mental flaws as signs of poor decision making, consider them as confirmation that not all shortcuts used in your brain are useful. While our cognitive decision-making functions can help everyday life, they can slip into patterns where we use them in situations that don’t serve us.

The key is to become self-aware when making choices and exhaust all options around us.