What to keep in mind when making decisions during unprecedented times

Given many families’ desire to make a difference in times of need, one arena we’ve seen decision-making come into play is philanthropic giving. Read about a family who took this time to focus on their group philanthropic efforts and details the specific steps they took and the key takeaways.

Authored by the Merrill Center for Family WealthTM


On average, an individual makes 35,000 decisions a day.1 Now, we are making those decisions under an elevated level of stress and ambiguity. The increase in uncertainty and volatility during this unprecedented time can have a direct impact on our ability to make effective decisions. At Merrill Center for Family Wealth™, we have helped many families take a step back to gain clarity on the “why” behind their decisions, understand the biases that could impact their decision- making, and develop a consistent method for making better decisions.

Given many families’ desire to make a difference in times of need, one arena we’ve seen decision-making come into play is philanthropic giving. To help illustrate key practices in decision-making, we share the story of the Miller Family,2 who took this time to focus on their philanthropic giving efforts as a family. The Millers had set up a Donor- Advised Fund (DAF) a few years back, but until recently, the DAF had served more as a means for tax efficiency rather than a vehicle to live out their family’s philanthropic values.

#1 Take a step back and start with your “why”

One of the first decisions the Millers were faced with in their philanthropic giving was what they would focus on; what would their mission be? They wanted it to be authentic to their family and something that their three young adult children would find compelling. To begin, the Millers’ Merrill advisor shared a whitepaper authored by Merrill Center for Family Wealth, “How Do Families Make Effective Wealth Decisions?” which discusses how families and individuals can enhance their own abilities to successfully navigate wealth decisions by starting with the purpose of their wealth. Their advisor suggested that they read and discuss the paper as a family to gain a better understanding of what factors go into the decision-making process and the importance of stepping back to clarify the purpose behind a decision as the first step.

Wanting to make headway on defining the “why” behind their giving, the Millers scheduled time to meet as a family to develop the prime underlying goal of philanthropic giving and the impact they wanted their giving to create in the world. They started with an exercise suggested by Merrill Center for Family Wealth that asks you to fill in the blanks: “We believe   , therefore our mission is              ”. After each family member wrote out a response and they discussed as a group, the family decided that their philanthropic purpose would be: “We believe that when people have access to basic necessities like food, shelter and healthcare, their opportunities have furthest reach. Therefore our mission is to support individuals and organizations in the U.S. fighting to address food insecurity, homelessness and healthcare challenges.”

To help further define the purpose behind their giving, the family’s advisor gave them a set of the Merrill Value Cards3 as a tool to help them take the first step. The Value Cards provide a repository of sample value statements to help identify core values and operating principles to inform financial, lifestyle, relationship, and philanthropic decision-making. All five family members provided their input in order to create a collective set of shared family values to help guide decision-making.

Having a focused conversation on why giving was important to their family helped the Millers specify the foundational values and operating principles that would animate their purpose statement and guide their giving strategy. For example, selecting the value of “teaching the rising generation the importance of philanthropy (money and time) through active participation” sparked a conversation on how the rising generation could increase their hands-on involvement in the family’s giving efforts. To the Millers, philanthropy meant more than just giving monetarily, but also contributing their time and intellect. Thus, family members committed to be actively involved in the process of selecting charitable organizations. As the family selected the value of “seeing and experiencing the tangible impact of our giving”, they decided that a significant portion of their giving would be steered towards local organizations that they could visit personally.

Key takeaway:

  • Before making a decision, ask yourself: What is the purpose that will drive my decision? How do my core values shape and inform my decision?
  • Defining your values can help provide a foundation to guide how you make decisions, both large and small. Taking a step back can help ensure that you do not let stress or a pressing timeline motivate your decision- making.

#2 Understand biases impacting decision-making

Once the Millers had gained some clarity on their overarching “why” behind philanthropic giving, they took a look at the biases that could unintentionally influence their decision-making. They examined some of the biases outlined in the decision-making whitepaper mentioned above. As a family, they selected a few TED Talks to learn more about how all individuals are impacted by biases in decision-making,4 such as: Why We Make Bad Decisions (2005) by Dan Gilbert and Are We in Control of Our Own Decisions? (2008) by Dan Ariely. Because agreeing on their purpose statement took up their first meeting, they agreed to set aside time together to meet virtually in the next month.5

That meeting would be dedicated to discussing the TED talks and identifying ways to incorporate what they learned about decision-making biases. Below are a few key biases they learned to be aware of when making decisions:6

  • Availability bias: relying on readily available information to the exclusion of harder to identify but relevant data points
  • Confirmation bias: seeking out information confirming what we already believe and not identifying key assumptions that could lead to significant mistakes
  • Recency bias: assigning disproportionate weight to recent activity and performance, without focusing on a longer timeline

Looking at their philanthropic endeavors, the Millers were able to spot the recency bias in their heavy focus on coronavirus relief efforts in a few specific cities that had been disproportionately affected by the pandemic and covered in the recent news. By going back to their foundational value of “seeing and experiencing the tangible impact of our giving” and the importance they held on supporting local organizations, the Millers were able to combat the recency bias by deciding to give a portion of funds to cities that were hardest hit, and also steering their efforts towards their home city of Chicago.

As articulated in their philanthropic purpose, the family felt strongly about addressing food insecurity and homelessness. The children had grown up visiting and donating to the local food bank as part of their school’s giving back program. Now, when looking at where to give in Chicago, they understood that only donating to the organizations they were familiar with would be allowing the availability bias to limit their decision-making. In efforts to broaden their understanding, each family member researched various organizations in the broader Chicago area to help fight food insecurity and homelessness. While researching organizations, the daughter, Susan realized that she had assumed food insecurity only affected those individuals living below the poverty line. What she learned is that food insecurity affected many people living above the poverty line as well.7 This deepened understanding of the issues, cultivated through research and conversations with representatives at various hunger relief organizations, helped the family fight the confirmation bias and expand their understanding of the various issues at play.

Key takeaway:

  • We are impacted by a host of different biases (subconsciously or consciously) and can act irrationally, particularly when under stress. It is important to first understand how biases may be impacting your decisions, so that you can work towards counteracting them.
  • Reflect on and discuss the above TED Talks with a friend or family member. Keeping in mind the upcoming decision you’ve decided to focus on, consider how you might be impacted by the referenced biases in regard to the decision you are facing. How might you counteract some of these biases?

#3 Adopt a decision-making process

In addition to learning more about the biases impacting their decisions, the Millers acknowledged that they could also benefit from implementing a process for making decisions. When they initially invited the rising generation into the philanthropic giving process, they were not clear on who would be making the decisions or how the decisions would be made. They quickly realized that to have cohesive engagement with all family members, a clear process would need to be adopted. After reflecting on their goals for active family member input and the time they had taken to ensure all family members felt connected to the mission and causes of support, they agreed on using a consensus style of voting called the “fist to five.” Family members would vote based on their enthusiasm for the organization.8 If they held up five fingers they were excited to give, four fingers meant they were supportive, three meant they were neutral, two meant they had reservations and one meant that they were opposed. If everyone put up three or more fingers, the measure passed, but it could be blocked if anyone held up one or two fingers. Those holding up two fingers or one finger had to explain their decision and work to improve the proposal. This approach signified that the rising generation members would have stake in the decision-making process, rather than simply provide input to be considered and ultimately decided by their parents.

In speaking with their Merrill advisor and Merrill Center for Family Wealth, they also learned that when narrowing in on a decision, it is important to understand the impact of how a question is framed. As economist Emily Oster explains in her recent article touching on decision-making,9 asking an open-ended question and hoping to make an effective decision in response is extremely difficult. In the Millers’ case, take the question: “What causes and organizations do we want to include in our giving?” Without knowing what the choices are, the decision-makers are left with too many possibilities to evaluate. However, try reframing the question: “Should we donate to relief causes to alleviate immediate needs, give to organizations fighting food insecurity or broader efforts to fix healthcare challenges?” This framing allows you to evaluate the clear factors at play, rather than struggle to navigate all the directions the original question could lead. Oster highlights that this type of framing is helpful to reveal holes in your thinking or clarify expectations embedded in the question. For example, the second framing eventually led family members to decide that they wanted to pursue a combined approach, giving to both coronavirus relief causes well as organizations fighting food insecurity more broadly. The decision did not need to be “either/or”; however, the specificity of the framing helped to narrow in the conversation.

When it came to the question of how the decision would be made, the family looked to outside resources for guidance. Chip and Dan Heath detail a process for overcoming common biases in order to make more effective decisions in their 2013 book, Decisive: How to Make Better Choices in Life and Work in which they lay out a process that they call WRAP:

  • Widen your options
    • What are three potential options to your decision? If you have difficulty identifying three options, imagine that your first and second options have disappeared. What would you do?
  • Reality-test your assumptions
    • How could you test your assumptions? Is there a way to test out options on a smaller scale? If you are leaning towards a particular option, consider what would have to be true for this option to be the very best choice?
  • Attain distance before deciding
    • Shift your perspective; what advice would you give to your best friend or family member if they were tackling the same decision?
  • Prepare to be wrong
    • Use the concept of prospective hindsight to tell two stories that have “already happened”:
    • In the first story: Imagine that your decision has resulted in a horrifically negative outcome. What went wrong?
    • In the second story: Imagine that your decision has resulted in a phenomenally positive outcome. What went right?

The Millers took their question of how to use their philanthropic donations to best align with their values and giving purpose through the outlined framework. By going through the WRAP process, they were able to avoid common biases and explore potential options they may have originally overlooked. For instance, during the second step of “reality test your assumptions”, the daughters decided to schedule site visits of organizations such a local shelter for homeless youths. By meeting with the shelter’s representative, who took them on a guided tour, they were able to gain a clearer picture of what the facility looked like and how it was run. Based on their visit, they decided to donate a portion of funds to go directly towards renovating a new recreational center for teens.

Key takeaway:

  • Given the multitude of unknown factors that you may be facing at this time, a decision-making process becomes that much more important when working towards effective decisions.
  • When making a decision, select one of the tactics discussed to help implement a process that works for you.


Making effective wealth decisions requires building new skills tailored for decision-making. The families we have worked with have found the ideas outlined above useful for making key decisions together. Consider taking one upcoming decision that you have and applying these key components: define your “why”, acknowledge and counteract biases and implement a process such as WRAP.

A private wealth advisor can help you get started.

Our advisors can help you follow your passions, build a legacy and have a positive impact on others.

1“How Many Decisions Do We Make Each Day?”, Psychology Today, September 2018.

2The Miller family represents a compilation family drawing directly from our experience at Merrill Center for Family Wealth™. Identifying details have been changed to preserve confidentiality.

3Merrill Value Cards were created in partnership with Merrill Center for Family Wealth and Money Meaning and Choices Institute.

4Resource Pak: TED Talks on Decision Making Biases, Harvard T.H. Chan School of Public Health, 2018

5For more on virtual meetings, see “Virtual family meetings in a time of coronavirus”, Merrill Center for Family WealthTM, 2020.

6“How Do Families Make Effective Wealth Decisions?”, Merrill Private Wealth Management, 2019. For more on information-processing biases, see the whitepaper, “Behavioral Considerations for Addressing Portfolio Concentration”, Merrill Private Wealth Management, 2018.

7What is Food Insecurity? Hunger and Health, FeedingAmerica.org, 2020. Food insecurity is defined by the U.S. Department of Agriculture (USDA) as a lack of consistent access to enough food for an active and healthy life.

8The “fist to five” method is outlined in “How do families make effective wealth decisions?”, Merrill, 2020.

9“How to Think Through Choices About Grandparents, Day Care, Summer Camp and More”, Emily Oster, emilyoyster.substack.com, May 2020.

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