Why Older People Tend to Be Poor Decisionmakers

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It’s not just dementia and cognitive decline that makes people more uncertain with age; changes in rationality and the way the elderly evaluate risk could explain why they are more likely to make the wrong decisions affecting everything from their health to their finances.

While numerous studies have documented a drop in cognitive function with age, there isn’t solid data to explain what drives this decline in decisionmaking, particularly in the face of uncertainty. But according to the latest research, poor choices made by the elderly can’t be attributed to their lack of math skills or a fear of financial losses. In the study, people over the age of 65 tended to be inconsistent when making decisions in which there was one obviously correct answer, like choosing between a definite win of $5 and a lottery with indefinite odds of winning the same amount.

The research, which was published in the Proceedings of the National Academy of Sciences, included 135 people, ranging in ages from 12 to 90, who made 320 decisions under different scenarios involving varying monetary gains or losses and differing levels of risk.

“We found it surprising and stunning,” says study co-author Ifat Levy, assistant professor of comparative medicine and neurobiology at Yale University. “These are highly functional older people, and they still got it wrong more often than younger people did.” She and her colleagues found that nearly half of the losses in possible income among the oldest people in the study resulted from this kind of error.

The results didn’t change if the oldest old were excluded — and the scientists tested for whether the effect was due to dementia. But all of the older participants performed well on multiple cognitive tests. Time pressure wasn’t a factor either.

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Prior research showed that most people are willing to take bigger risks when there’s a possibility of gaining money than if there’s a risk of losing what they already have.

But the elderly in the study revealed nearly the opposite behavior, exposing a seemingly irrational and inconsistent thought process. While they were far less adventurous than younger adults when making choices about possible gains, they seemed to throw caution to the wind when it came to making decisions about potential loss.

Levy isn’t sure why this occurs, but speculates that it may have something to do with the older participants’ life experience. “I think maybe they think that they have less to lose as they are approaching an old age or the end of life,” she says. That could have less to do with cognitive changes and more to do with the shifting value they place on risk and benefit as they age.

That understanding could have implications not only for family members caring for elderly relatives, but also for policymakers as the proportion of older people in our society increases. The findings may help explain why the elderly are much more vulnerable than the young, for example, to financial losses and to making poor health decisions. “It’s definitely a big part of why they may get taken advantage of,” says Levy. “At the policy level, this is [maybe] something that should be taken into account in planning retirement and health options that are offered.”

In fact, other research suggests that the impairments in decisionmaking may extend beyond financial situations to situations like driving. And that’s why the researchers urge additional studies to uncover more about how the older life stage, independent of cognitive decline, changes the way the elderly make decisions.

(MORE: Today’s 90-Year-Olds Are Mentally Sharper Than Their Predecessors)

Recognizing this, the authors conclude, “Although this may be a unique study of age and preference on this scale, it is important to recognize that it is in fact a very small study, conducted in two cities in the northeastern United States. This study should not be taken as offering any final characterization of decision making across the lifespan in the human population.” It does, however, suggest that we need to learn a lot more about the different ways that age affects decisions — and what can be done about it.


As one of the elderly discussed above I have find I agree with Lacy.  You nailed it Lacy, it is our accumulated life experiences that have a tremendous impact on what we decide to do.  I had to smile, because my very first thought when I read the "definite win" of $5 was, ok, what's the scam? Life has taught me to step back from something that looks like it's free.  Somewhere in there I most likely will find that this free $5 will wind up costing me at least that much if not more.  My second thought was " and what if it is really free?  Maybe it's being offered by someone who is a cheater or a thief!? " So, yes, that offer required a bit of thought and concern.

As far as health goes, I've already made some choices that some folks do not agree with.  My logic? I want quality of life over quantity now.  My definition of quality may be different from younger people, too.  And I'm sorry if you think that is being selfish, but after all these years of caring and doing for others it is now my turn.  I am not going to choose extended suffering no matter how much you are going to miss me.

I hope more people comment on this article.  I am anxious to see what others think.


While I found this article interesting, I must disagree with it. Excluding elderly who actually do have dementia or some kind of cognitive decline, they are fully capable of making informed decisions. The elderly have lived long lives full of different life altering experiences. Because of this, they are able to make highly informed decisions based off of their personal life experiences, whereas younger people do not have as much experience and knowledge to base their decisions on. When it comes to health, a young person may decide to go with a certain course not being fully aware of what this could mean. The elderly may choose a different course because they may have seen similar situations in their many years. Younger people may not understand this decision, but that does not make it the wrong decision. With the scenario that the researchers used, perhaps the elderly decided to chance losing it all because they know from a lifetime of playing it safe that playing it safe has never gotten them anywhere. Younger people play it safe because they have not had as much experience with such circumstances and fear the risk. As such, the elderly are fully capable of making well thought, informed decisions based on their personal life experiences.


@lacy_barrettLacy, I think you are on to something with your point that "the elderly may choose a different course because they may have seen similar situations in their many years." and I also agree that younger people might not understand the decision. That is what makes this interesting and worthy of further study.

The LA Times has an article that gives different details: http://www.latimes.com/science/sciencenow/la-sci-sn-do-we-make-poorer-decisions-as-we-age-20130930,0,611173.story

The gist of both articles is that the elderly made irrational choices more often than adolescents or young and middle aged adults. Specifically, seniors made irrational choices 25% of the time, adolescents 10% of the time, and young and mid-life adults 5% of the time. 

To get back to your example,  " With the scenario that the researchers used, perhaps the elderly decided to chance losing it all because they know from a lifetime of playing it safe that playing it safe has never gotten them anywhere." I suspect you are correct, but it is still an irrational choice. If offered a 100% chance of receiving $5 or a 99% chance of receiving $5, the rational choice is to take the 100% chance. If people choose a chance at $5 over a sure $5 because of life experience, that is a finding worth studying. 

--Rather than disagree with the findings I think we should try to understand them


Since this is a snapshot of the elderly now, I wonder if this is an issue with the current cohort of elderly, perhaps based on the economic realities experienced over a lifetime. Given that the results were common to people age 65 to 90, probably not. 

I would be interested in knowing when, on average, the change takes place. If it is common to people over 65 that implies the change in reasoning ability is either takes place at 65 or, more likely, earlier.