This type of character is typically represented as a kind and wise, older father-type figure who uses personal knowledge of people and the world to help tell stories and offer guidance that, in a mystical way, may impress upon his audience a sense of who they are and who they might become, thereby acting as a mentor. He may occasionally appear as an absent-minded professor, losing track of his surroundings because of his thoughts were just mind boggling.
The wise old man is often seen to be in some way "foreign", that is, from a different culture, nation, or occasionally, even a different time, than those he advises. In extreme cases, he may be a liminal being, such as Merlin, who was only half human.
In medieval chivalric romance and modern fantasy literature, he is often presented as a wizard. He can also or instead be featured as a hermit. This character type often explained to the knights or heroes — particularly those searching for the Holy Grail — the significiance of their encounters.
In storytelling, the character of the wise old man is commonly killed or in some other way removed for a time, in order to allow the hero to develop on his/her own.
Jung dubbed this character as a senex. This is Latin for old man in general, and in fact, two stock characters of the stage are the senex iratus, an old man who irrationally objects to the love between the younger characters, and the senex amans, an old man foolishly in love with a woman too young for him. Jung's senex, unlike these characters, has grown old graciously. His wisdom is not only in his increased knowledge and judgment, but his knowing that younger people have taken on the role of hero, and that his position has changed to one of mentor.
Merlin fell from the role of senex to senex amans when he fell in love with Nimue; this lapse in judgment is what led to his enchantment and imprisonment. (Wikipedia)
