Certified High-Performance coach, speaker, author, husband, adventurer, former commando-paratrooper, and tsunami survivor.
The Psychology of Decision-Making: Why We Screw Up and How to Get It Right
Why do we sometimes do things we know we’ll regret? Why don’t we do what we know we should? It’s a question we all have asked ourselves at some point, usually while dealing the consequences of a dumb choice. This article explores the mechanics of decision-making and how we can stop (or at least reduce) making stupid decisions.
Everything in your life—your health, your relationships, your career—is the result of decisions you’ve made.
EVERYTHING.
Sure, we don’t all start at the same place. Some people are born with a silver spoon; others get a rusty fork. But at the end of the day, the choices you make shape who you become. You can be born into wealth and still end up broke, alone, or lost. And you can come from nothing and rise above it all. It all comes down to your decisions.
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The Psychology of Decision-Making
How we make choices: what’s really happening upstairs
The process seems simple enough: you weigh your options, predict the outcomes, and choose. But well.. our brains don’t operate on logic alone. Emotions, past experiences, social pressure, and fear all come to mess around. Let’s break it down.
Step 1: Spotting the fork in the road
Every decision starts with recognizing you need to make one—whether it’s solving a problem, grabbing an opportunity, or dealing with pressure. Your brain fires up, and the decision-making engine kicks in.
Step 2: Gathering intel
Your brain starts pulling together the pieces it needs:
• Your past experiences (what worked or blew up before).
• Your emotions (fear, excitement, doubt).
• External factors (peer pressure, societal norms, deadlines).
• Your internal state (are you stressed, tired, or already overwhelmed?).
Your brain isn’t just running the numbers, the good old amygdala is also making sure you clearly understand ALL the potential risks. It’s not a bad thing, just trying to keep you safe!
Step 3: Weighing the options
Here, the brain analyzes each potential choice. Basically, we evaluate the pros and cons.
Will this choice help me achieve my goal? What are the risks? What are the rewards? What do we miss out on? What do we gain?
We’re also thinking about what other people will say. That old survival instinct: “If I screw this up, will I lose my spot in the tribe?” Social pressure is real. So is fear of being judged.
On top of that we have a couple of biases that affect our judgement too. For example:
The loss aversion bias: our tendency to avoid losses more than we chase gains. It’s why keeping things safe feels so tempting, even if it means settling for less.
The overconfidence bias: we often think we’re better at predicting outcomes than we actually are. (LOL, sounds familiar?)
Step 4: Predicting the future (well, kind of..)
Now your brain runs a simulation: “What happens if I choose X? What if I go with Y?” Positive outcomes make you feel confident, while negative ones make you second-guess. But like if things are not complicated enough, our emotions are pulling hard for the easy win.
For example, say you want to stay fit. Rationally, you know skipping the gym is a bad move. But emotionally? That couch and a bowl of ice cream look damn good. Short-term pleasure often overpowers long-term goals because your brain hates uncertainty. You know the ice cream will make you feel good right now, but the six-pack? That’s weeks (probably months) away.
The Dopamine Effect
It’s all about dopamine—the brain’s reward chemical. Every time you think about something pleasurable, your brain releases a little hit of dopamine as a teaser. It’s like a preview of the pleasure you’ll feel if you give in. And your brain loves it. It’s wired to prioritize immediate rewards over long-term satisfaction because, back in the day, survival depended on seizing short-term opportunities (like food or shelter) right away.
This is why short-term gratification often dominates. Decisions are often made not through purely rational processes but rather through a hedonic lens.
Present bias: why short-term wins
Take arousal, for example. When you’re emotionally or physically charged—whether it’s excitement, anger, or desire—your brain’s ability to think long-term gets hijacked. A fascinating study published in the Journal of Behavioral Decision Making proved this. Researchers found that individuals in a sexually aroused state were more likely to make risky or short-sighted choices compared to those who were not.
Participants answered questions related to sexual behavior under both aroused and non-aroused conditions. When aroused, they found riskier sexual activities more appealing and were even more open to morally questionable actions. What’s happening here? The emotional state amplified their focus on immediate pleasure, drowning out logical reasoning about potential consequences.
Your brain overvalues the now and undervalues the future (present bias). That’s why short-term pleasure feels so compelling, even when it has negative consequences on your long-term goals.
Step 5: Pulling the trigger
When the dust settles, your brain makes the call—a mix of logic, emotion, and bias. But the story doesn’t end here.
Step 6: Looking back
Once the choice is made, your brain reviews the outcome. Did it work out? Did you mess up? This feedback becomes part of your mental playbook, shaping how you handle future decisions.
Two systems of decision-making
Cognitive psychologist Daniel Kahneman introduced a groundbreaking model of how the brain makes decisions, describing two distinct systems:
System 1: Fast and Intuitive
How it works: Operates automatically and unconsciously, relying on heuristics (mental shortcuts) shaped by past experiences.
When it kicks in: Handles immediate, low-effort decisions where speed matters.
Example: Slamming the brakes when someone suddenly crosses the street—a snap judgment with no time for deliberation.
System 2: Slow and Deliberative
How it works: Requires conscious effort, focus, and logical reasoning. It processes complex information and weighs evidence before reaching conclusions.
When it kicks in: Steps in for high-stakes or complicated decisions that require analysis and long-term thinking.
Example: Comparing job offers by evaluating salary, location, growth potential, and aligning the choice with your long-term goals.
These systems are not isolated; they often interact. System 1 generates quick initial judgments or emotional responses, which System 2 can refine or override—if we let it. The catch? System 1 dominates in many situations because it’s faster and easier, while System 2 takes effort to activate.
Improving decision-making
The key to making better decisions lies in understanding how System 1 and System 2 work together—and deliberately engaging System 2 when it matters most.
- Pause: When faced with an important decision, slow down. Give System 2 the chance to step in and evaluate your options with logic, instead of letting System 1 dominate with snap judgments. SLOW DOWN. This pause is where better decisions begin.
- Reflect: Recognize that your brain’s biases, emotions and all the shortcuts we’ve talked about are influencing your judgment. Challenge them.
- Clarify your goals: What truly matters to you?
- Remember your values: Does this choice align with them?
- Project yourself forward: Imagine your future self six months or a year from now. How will this decision feel then? Instead of focusing on the immediate emotional payoff, shift your perspective to the longer-term impact. THINK about the bigger picture.
3. Regulate: Emotions like stress, anxiety, or excitement are fuel for System 1, making impulsive choices more likely. Calm your body and mind. RELAX. Take a deep breath. When you breathe, you create the space for System 2 to lead (that rhymes!).
The Emotional fallout: Regret, Guilt, and Shame
Once a decision is made, it’s not the end of the story. The aftermath often comes with a mix of emotions, especially when things don’t turn out as planned. Three of the most common (and toughest) to navigate are regret, guilt, and shame. These emotions aren’t just feelings—they shape how we view ourselves, and our ability to make decisions in the future.
1. Regret: The “Should Have” Syndrome
Regret is that annoying voice in your head saying, “You messed up; you should’ve known better!” It thrives on comparison—between what is and what could’ve been. And hindsight bias doesn’t help; it tricks you into thinking the “better choice” was obvious all along. Spoiler alert: it wasn’t. (Unless you made a dom dom move—then yeah, maybe it was.)
You can’t change the past. So stop wasting time crying about it. Ask yourself, “What can I learn from this?” Use it as a tool, not a trap. Dwelling on the “what ifs” only keeps you stuck. Take control, reframe, and let regret push you toward smarter decisions next time.
2. Guilt: When you violate your own values
Guilt isn’t all bad. It’s like your brain tapping you on the shoulder and saying, “Hey, you messed up, but you care enough to notice.” Unlike shame (which attacks who you are), guilt is about what you did. It’s tied to your values and reminds you to fix what’s broken.
Here’s how you deal with it:
1. Face it. Don’t run from guilt—it’s a sign you’re still in the game.
2. Apologize or take action if you can. Do what’s needed to make it right.
3. Move on. Seriously, let it go. You did your part, so stop replaying it.
And maybe don’t screw up the same way again. Guilt only serves you if you learn from it. Otherwise, it’s just dead weight.
3. Shame: The identity crusher
Shame isn’t about what you did; it’s about who you think you are. It whispers, “You’re not enough. You’re broken. You’re bad.” Shame doesn’t just sting—it can sink you. If left unchecked, it leads to hiding, self-doubt, and even depression.
Failing doesn’t make you a failure! You’re not defined by one mistake or even a series of them. The key is to separate your actions from your identity.
• Acknowledge what happened.
• Own the behavior that needs changing.
• Remind yourself that you are not your mistakes.
Shame wants to keep you down. You fight it by rewriting the story—one where messing up isn’t the end but the spark for growth.
Conclusion: Own your emotions, own your decisions
Regret, guilt, and shame are part of the messy business of being human. But letting them run the show? That’s a one-way ticket to overthinking, fear of risk, and playing life way too safe.
Every decision you make is based on the information, emotions, and mindset you had in that moment. Sometimes you’ll crush it; other times, you’ll stumble. That’s life. If you’re doing your best, cut yourself some slack. If you’re not, then yeah—take this as a wake-up call to start trying harder.
The goal isn’t to avoid tough emotions—it’s to use them. Process them, learn from them, and then make decisions that align with who you want to be. That’s how you grow, evolve, and keep moving forward. Don’t let your past write your future. That’s your job.
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