When your mind is going every which way

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How do we make decisions?

Many of us have spent more than a night or two staring at the ceiling and wondering what to do with our lives, what career to pursue and where we'd rather be living. And then we spend our days making choices about what shoes to wear, which road will get us to work quicker and where we should eat for lunch.

It's not always easy to make a sound choice, but when we do, the process goes like this:

  • Determine your goal.
  • Determine its value.
  • Arrange and examine the options available to reach it.
  • Determine the likelihood of each option meeting your goal.
  • Choose the option with the highest likelihood of meeting it.
  • Use the outcome of this experience to adjust your future goals and the way in which you make future decisions.

[source: Schwartz]

It's the best way to make a decision, but often, our feelings and instincts derail the process. While you may know to keep your hand off a hot stove after being burned, it's a learned behavior rather than a conscious choice; when it comes to life, we often repeat our mistakes.

Many bad decisions are the result of setting a bad goal to begin with. The struggling addict, when slipping, has shifted the goal from staying sober to getting intoxicated. So the first step of making a decision requires you to ask yourself a question: What, exactly, do I want?

Once you've established your goal, you have to figure out how to reach it. Your beliefs, experiences and personality will determine the options you consider.

Let's say you need money. You reason that you could:

  • Mow lawns in your neighborhood.
  • Work at a local shop or restaurant.
  • Polish your resume and look for a higher-paying job.
  • Start learning about investing.

In order to become educated about the merits of each option, you have to find reliable sources of information. Too much information, however, can skew your decision making and make the outcome seem more important than it really is (think of someone's perpetual indecisiveness in picking a restaurant for lunch). Fear of regret is a powerful motivator, and studies show that when we have too many options, we think we'll suffer more regret if we choose the wrong one. Also, we may subconsciously deep-six our original goal by not being honest with ourselves about which option is best. Our established goal (such as making more money) may not be our real goal (taking it easy).

Next, you have to determine which choice best suits your goal. If it's to improve your financial situation, the values of your options may look like this:

  • My money problems are too significant for lawn-mowing to help.
  • I may lose my house if I don't increase my income soon.
  • There's no time to start learning how to invest, and I have nothing to invest.
  • I'll pick up immediate work in a restaurant and work on my resume after that.

You may choose the final option, and then see if it makes you happy or remorseful. Did it get you out of your financial jam? Or should you have focused on your resume instead? The next time you make a decision, you'll use the outcome of this one to ponder, once again, how to go about choosing the very best future.

Lots More Information

Related ArticlesSources
  • Caldwell, Christopher. "Select All: Can you have too many choices?" The New Yorker. March 1, 2004. (Aug. 5, 2010)http://www.newyorker.com/archive/2004/03/01/040301crbo_books
  • Coricelli, Giorgio et al. "Regret and its avoidance: a neuroimaging study of choice behavior." Nature Neuroscience. Aug. 7, 2005. (Aug. 5, 2010)http://www.nature.com/neuro/journal/v8/n9/abs/nn1514.html
  • Doya, Kenji. "Modulators of decision making." Nature Neuroscience. Mar. 26, 2008. (Aug. 5, 2010)http://www.nature.com/neuro/journal/v11/n4/abs/nn2077.html
  • New York University. "Brain Imaging Study Provides New Insight Into Why People Pay Too Much In Auctions." ScienceDaily. Sept. 28, 2008. (Aug. 5, 2010) http://www.sciencedaily.com/releases/2008/09/080925144607.htm
  • O'Doherty, J.; Kringelbach, M. L.; Rolls, E.T.; Hornak, J.; Andrews, C. "Abstract reward and punishment representations in the human orbitofrontal cortex." Nature Neuroscience. Jan. 1, 2001. (Aug. 5, 2010)http://www.nature.com/neuro/journal/v4/n1/full/nn0101_95.html
  • Scheibehenne, Benjamin et al. "Can There Ever Be Too Many Options? A Meta-Analytic Review of Choice Overload." Journal of Consumer Research. Feb. 10, 2010. (Aug. 5, 2010)http://www.journals.uchicago.edu/doi/abs/10.1086/651235?journalCode=jcr
  • Schwartz, Barry. "The Paradox of Choice: Why More is Less: why more is less." HarperCollins, 2005. ISBN 0060005696, 9780060005696. http://books.google.com/books?id=ElQVdxAipZ0C&printsec=frontcover#v=onepage&q&f=false
  • Tugend, Alina. "Too Many Choices: A Problem That Can Paralyze." New York Times. Feb. 26, 2010. (Aug. 5, 2010)http://www.nytimes.com/2010/02/27/your-money/27shortcuts.html
  • University Of California, Los Angeles. "How Does Your Brain Respond When You Think About Gambling Or Taking Risks? Study Offers New Insights." ScienceDaily. Jan. 26, 2007. (Aug. 5, 2010)http://www.sciencedaily.com/releases/2007/01/070126091459.htm
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