Why We Make Bad Decisions Over and Over
New research reveals common human decision-making mistakes, at work and in life—and how to avoid them
Every day, we make thousands of decisions. Most are small and automatic—what to eat, what to wear, whether to send that email now or later. Others are major and consequential—choosing a career path, ending a relationship, investing in a startup. Yet whether big or small, many of these decisions are…well, bad.
And what’s worse: we keep making the same bad decisions again and again.
Why? How can intelligent, well-meaning people repeatedly make poor choices—at work, in relationships, in health, and in money?
Recent research in behavioral psychology, neuroscience, and economics offers some answers—and, importantly, shows us how to break the cycle.
The Hidden Drivers Behind Our Bad Decisions
It turns out that bad decision-making isn’t about being unintelligent or uninformed. It’s about being human.
Here are some of the core psychological patterns that lead us astray:
1. Cognitive Biases: Mental Shortcuts Gone Wrong
Our brains rely on heuristics—mental shortcuts—to make decisions quickly. But these shortcuts can misfire.
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Confirmation Bias leads us to seek information that supports our existing beliefs while ignoring contradicting evidence.
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Availability Bias makes us overestimate the importance of information that’s most easily recalled—like recent news or personal experiences—rather than what’s most relevant or accurate.
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Anchoring Bias causes us to rely too heavily on the first piece of information we receive, even if it’s arbitrary or unrelated.
For example, if you’re negotiating a salary and the first number mentioned is low, your counteroffer is likely to be anchored around that number—leading you to undervalue yourself.
2. Emotions Cloud Our Judgment
Emotion plays a critical role in decision-making. In fact, research shows that people with damage to emotional centers of the brain often become indecisive.
But emotions can also distort our thinking. For instance:
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Fear of missing out (FOMO) can drive impulsive investment choices.
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Regret aversion can prevent us from leaving a bad relationship or job because we’re afraid of future guilt.
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Overconfidence can lead us to overestimate our abilities or ignore potential risks.
We often feel our way into decisions, justifying them with logic afterward.
3. Social and Peer Pressure
We like to think we’re independent thinkers, but humans are deeply social creatures. Studies show we’re strongly influenced by group dynamics—even when we know better.
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In workplace settings, this leads to groupthink—where dissent is suppressed and consensus is forced.
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On social media, comparison with others can distort our sense of what’s “normal” or desirable.
This is why people stay in jobs or lifestyles they secretly hate—because everyone else seems to be doing the same.
4. Decision Fatigue and Overload
Modern life demands constant decision-making. As our mental energy gets depleted throughout the day, we suffer from decision fatigue—a state where we default to the easiest, often worst, option.
That’s why many people end up eating junk food at night or scrolling endlessly on their phones despite better intentions. The brain simply runs out of gas.
How Bad Decisions Multiply
The real danger of poor decisions is how they compound over time.
One impulsive purchase? No big deal. A habit of overspending? Financial stress, debt, and anxiety.
One skipped workout? Understandable. A pattern of neglecting health? Serious long-term consequences.
In organizations, one ignored red flag may lead to small losses. Repeated failures to act on warning signs can lead to scandals, bankruptcy, or collapse.
Research from Harvard Business School found that most corporate disasters are not caused by one bad decision—but by a series of small, compounding errors ignored or rationalized along the way.
So how do we stop the cycle?
How to Make Better Decisions—Consistently
The good news is that once we understand the psychology behind our mistakes, we can design strategies to outsmart our brains.
1. Slow Down Your Thinking (System 2 Thinking)
In his book Thinking, Fast and Slow, Nobel laureate Daniel Kahneman describes two modes of thinking:
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System 1: Fast, intuitive, automatic
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System 2: Slow, deliberate, analytical
Most bad decisions are made using System 1. To improve, we need to engage System 2—especially for important or high-stakes choices.
How to do it:
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Pause before making key decisions.
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Write down pros and cons.
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Ask: “What would I advise a friend to do?”
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Sleep on it—literally. Decisions improve after rest.
2. Create Decision Frameworks
Clear frameworks help reduce emotional influence and bias. Examples include:
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The 10/10/10 Rule (How will I feel about this in 10 minutes, 10 months, and 10 years?)
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Cost-Benefit Analysis
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Pre-mortem Strategy: Imagine your decision failed. Why? What went wrong?
By externalizing your thinking, you can spot blind spots before they sabotage you.
3. Limit Your Choices
Paradoxically, more options often lead to worse decisions—a phenomenon known as the paradox of choice.
In one famous study, people offered 24 kinds of jam were less likely to make a purchase—and less satisfied when they did—than those offered just 6.
What to do:
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Reduce your daily choices with routines (e.g., meal prepping, capsule wardrobes).
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Use constraints to narrow options: budget limits, timelines, or checklists.
4. Practice Meta-Cognition
Meta-cognition means “thinking about your thinking.” It helps you recognize your patterns and interrupt them.
Ask yourself:
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What biases might be influencing me?
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Am I acting from fear, anger, or ego?
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What do I really want from this decision?
Journaling or talking with a mentor can help develop this skill over time.
5. Build a Feedback Loop
You can’t improve what you don’t evaluate. But most of us rarely revisit our past decisions.
Start a decision journal. After every major decision:
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Write down the reasoning and expected outcome.
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Revisit it weeks or months later.
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What went right? What went wrong?
Over time, you’ll build a more accurate sense of your judgment and patterns.
6. Surround Yourself with Sounding Boards
Great decision-makers aren’t lone wolves—they seek out dissenting voices.
Warren Buffett credits much of his decision-making clarity to working with Charlie Munger, who regularly challenges his thinking.
Whether in business or personal life, make sure you have at least one person who:
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Will question your assumptions
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Isn’t afraid to say, “This might be a mistake”
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Offers an outside perspective
Don’t fear disagreement—it’s a sign you’re thinking critically.
At Work: How Teams Can Make Smarter Decisions
Organizations are just groups of people making decisions. And the same cognitive pitfalls apply at scale—often amplified by politics, culture, or bureaucracy.
Here’s how to build better decision-making at work:
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Normalize disagreement: Encourage honest debate in meetings.
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Clarify decision rights: Who makes the final call? Avoid ambiguity.
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Debrief regularly: After major projects, review what decisions worked or failed—and why.
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Track metrics: Base decisions on data, not just opinions.
Cultures that reward truth over ego make better long-term calls.
In Life: Breaking Out of Bad Patterns
It’s tempting to beat ourselves up over past mistakes. But self-compassion is essential for change.
The goal isn’t perfection—it’s awareness.
Once you understand the hidden drivers behind your choices, you can start to shift them. Not instantly. Not always easily. But consistently.
Ask yourself:
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What decisions do I keep repeating that don’t serve me?
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What belief or bias might be driving those choices?
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What small action can I take today to interrupt the cycle?
Whether it’s changing how you spend money, who you date, or how you manage your time—transformation starts with one conscious decision.
Final Thought: Good Decisions Are a Skill, Not a Trait
Making good decisions isn’t about being smarter or luckier than others. It’s a learned skill—one you can refine with effort, feedback, and intention.
So the next time you find yourself thinking, “How did I make the same mistake again?”—don’t just blame yourself.
Study it. Reflect on it. Learn from it.
And make the next decision a better one.
Want to improve your decision-making even more?
Consider starting a “Decision Audit” once a month. Track key decisions, note outcomes, and identify any recurring blind spots. Over time, this single habit can sharpen your instincts and boost your confidence.