The 33-year-old Scotsman had been offered the chance to join compatriot Gary McAllister's side until the end of the season, but he admits his heart is with the Eagles.
He told the Croydon Guardian: "I had a good chance to go to Leeds and play some football, but I'm not 19 so I can't just jump in a car with four young kids, which I explained to Gary.
"But I enjoy playing here. I enjoy coming to Selhurst Park. I think I've still got something in me so I'm hanging on with my fingernails and I think that's the right decision for the time being."