(June 2007) The increasing size and longevity of the elderly population means that older people's decisions on health care, risky investments, and other choices will become increasingly important to individuals and society. That is prompting researchers to take a new look at how older people make decisions.

Aging brings changes in how people use both their emotions and reasoning in making decisions. Researchers are exploring whether these changes hinder good choices and, if so, what could be done to help older people make better decisions.

There are universal facets of aging and cognitive decline that researchers are concerned could raise the risk of making an ill-considered decision. In older adults:

  • Information-processing speed slows, especially when dealing with complex facts.
  • The ability to focus intensely decreases.
  • Memory for facts declines, particularly memory about how information was acquired.

Also, emotional goals become more important with age, as does a preference for positive information that could override the facts of a situation. Memory may play a role in this preference, because personally meaningful and relevant information is more successfully recalled.

Changes in Cognitive Functions Could Hurt Decisionmaking

There is evidence that old and young make decisions differently. Research shows that older people sometimes forget their earlier decisions. They consider a smaller amount of information before deciding, generate fewer decision options, and make up their mind more quickly than younger people. They are more likely to use intuition and other decision shortcuts. They may read information in ways that miss important facts.

One experiment found that older adults made more conservative decisions about several hypothetical medical situations than younger people did. That gap disappeared, however, when older people had more time to review the information they needed to make a decision.

Emotional goals also become more important with age, researchers theorize, and perhaps override the facts of a situation. Younger people seek future-oriented new knowledge, according to this theory, but older people try to preserve good feelings in the present. In one experiment, older people were more likely to remember an emotion-based advertisement for a camera that captures "those special moments." Younger people preferred the other choice, a camera that photographs "the unexplored world." But when asked to imagine which ad they would prefer if their physicians had told them they had 20 more years of healthy lifespan than they had expected, differences between old and young disappeared.

Elderly Prefer to Accentuate the Positive, Which Could Have Negative Impacts

Researchers including Laura L. Carstensen, a psychology professor at Stanford University and director of its Center on Longevity, have found a decided preference for positive thinking among the elderly. Carstensen's research indicates that young people are more likely to remember negative images, middle-aged people have a small preference for positive images, and the elderly overwhelmingly favor the positive. Brain imagery shows more neural activity in old people when positive information is presented, whereas with younger people negative and positive information elicit an equal response.

Accentuating the positive does benefit well-being but could affect decisionmaking. There is evidence that older people put off making some crucial decisions—whether to undergo a serious medical procedure, for example—because they do not want to think about potential unpleasantness. They also may make more conservative decisions in an effort to maintain their sense of well-being.

Ignoring negative information could also push a decision in the wrong direction. Researchers Mara Mather of the University of California, Santa Cruz, and Quinn Kennedy of Stanford University give a hypothetical example of a woman deciding whether to renew a health plan: She likes her physician, but overlooks the fact that the insurance plan does not pay for an important benefit such as hip surgery.

How Do Declines Affect Decisionmaking? No Easy Answers

Although cognitive declines that accompany aging would suggest that decisionmaking also deteriorates, "deliberative decline may be too simple an answer," according to Ellen Peters, senior research scientist with Decision Research. For one thing, she told the Association for Psychological Science annual convention in Washington, D.C., last month, "If it matters more to older people, they bring their resources to bear" in ways that may compensate for lost capabilities.

It may be, she concluded, that older people make better choices than younger people in some situations and worse ones in others.

In fact, "most studies of decisionmaking for risk that include older adults report no age difference in risk attitude and risk behavior for financial or health decisions, and games of risk," according to Mather and Kennedy. Old and young perceive risk in comparable ways, they report, and are equally vulnerable to making choices based on wording that emphasizes the positive or negative implications of a potential decision.

Stephanie Kovalchik and her colleagues have found similar results in recent experiments on economic decisions. In fact, their results suggest that overconfidence in younger people affects decisionmaking more than it does in older people. The researchers suggest that older people have learned to use experience to temper overconfidence. This means these adults behave more like experts do. They have more accurate beliefs about their knowledge and limitations.

Accumulated experience also may help older people make quicker decisions that are no worse than the ones younger people make. In some cases, they may make better decisions: One study found that older people were more likely than younger people to favor using a pneumonia drug with a good cure rate when presented with a hypothetical situation that also included mention of side effects.

Ideas to Help People Make Better Decisions

This research may have important implications for policymakers, for people who provide services for the elderly, and for aging people and their families. Older people face increasingly complex decisions about retirement planning or health care. Because wealth is accumulated over a lifetime, older adults also control a great deal of the wealth in this nation. For this reason, understanding the economic decisions made by this group is important to social policy.

One key lesson from the research on cognitive aging and decisionmaking is that how information is presented can have an impact on a decision. Even in the research by Kovalchik, there are indications that older people exhibit more confused behavior, despite performing well as younger adults.

If a decision involves analyzing numbers, the figures need to be presented clearly. Older people may need more time to make decisions, both because of cognitive limits and because pressure generates anxiety that could lead to bad choices. They may do better with written, not oral, presentations, so they can review information at their own pace.

Older people also may be more likely to remember information presented with a personal focus, rather than as an abstract idea. The wording of instructions also may help: In one experiment, older people who were reminded repeatedly to "focus on the facts" made decisions that used more balanced information than those who did not receive that message.

D'Vera Cohn is senior editor at the Population Reference Bureau. Marlene Lee is a senior policy analyst at the Population Reference Bureau. Funding for this article was provided by the National Institute on Aging.


Quinn Kennedy and Mara Mather, "Aging, Affect and Decision Making," in Do Emotions Help or Hurt Decision Making? A Hedgefoxian Perspective, ed. Kathleen. D. Vohs, Roy F. Baumeister, and George Loewenstein (New York: Russell Sage Foundation Press, forthcoming).

Stephanie Kovalchik et al., "Aging and Decision Making: A Comparison Between Neurologically Healthy Elderly and Young Individuals," Journal of Economic Behavior and Organization 58, no. 1 (2005): 79-94.

Elizabeth Peters et al., "Adult Age Differences in Dual Information Processes: Implications for the role of Affective and Deliberative Processes in Older Adults’ Decision Making," Perspectives on Psychological Science 2, no. 1 (2007): 1-23.

Carolyn Yoon et al., "Cognition, Persuasion and Decision Making in Older Consumers," Marketing Letters 16, no. 3/4 (2005): 429-41.