man and woman receiving financial advice

Questioning Financial Advice

Taking control of your money

Recently I was watching one of the national morning TV talk shows. The host said, “And stay tuned for our next segment on what you should do today to ensure your financial security!” So I tuned in, wanting to hear what new advice the expert had to offer.

Here was the fresh and innovative advice.

  • “Live humbly. Keep your life simple.”
    I looked “humble” up in the dictionary. One definition is “to make somebody feel less important.” Why would anyone choose to do that?
  • “Have a budget.”
    This is new?
  • “Catch up. If you haven’t been saving, then you’d better save, save, save ! If you’re in your 40s or older, then save even more.”
    Well, that’s original!
  • “Work longer. The longer you can postpone taking your Social Security or government payout, the better.”
    You have to love that one. How inspiring!

This is the standard advice spouted on how to ensure financial security.

Is it new? No. Thought-provoking? No. Worthwhile? Not in my opinion. This advice may be good for people who want to “get by” or just survive financially. But this advice will not bring you financial independence.

It does nothing to excite me to take action. Where’s the drive, the passion, the excitement for life?

The reality is that in life there is always someone ready to give you advice, especially when it comes to money. In a world full of advice, how do you know what to listen to and what to ignore? Knowing how to answer that question is one of the biggest keys to attaining financial freedom.

How to Tell Good Advice from Bad Advice

The first thing you have to know is what advice or information you’re looking for. This depends on the dream and goal you aspire to. It also depends on your plan to get there. Your plan is simply what you have to do to attain your dream. Your plan does not need to be complicated. For instance, if you decide you want to be a tennis player, that’s the dream. Your plan is to buy a tennis racquet, tennis balls, tennis shoes, and a tennis outfit and to take lessons three times a week.

Second, you have to know whom you want to take advice from. You, and no one else, choose what information you put into your brain and which teachers you want to learn from.

Finally, you have to know what advice and information are relevant and meaningful to you, and which are not. For example, the advice from the morning TV show is not relevant or meaningful to me because it is not aligned with my goals or my values.

Ask, “What Does That Mean to Me?”

The world of money is fascinating. I think many of us probably lose interest or have that eyes-glazed-over syndrome if what we’re reading or watching seems to have no relevance to us. If I’m listening to a radio show and the upcoming guest is going to talk about how to train a hamster, then I’ll switch stations because I don’t have a hamster. But we all have money, so when I’m watching a financial news show or reading a newspaper article about the economy, the question I ask is, “What does that mean to me?”

For example, there is a lot of talk about possible inflation. So what does that mean to me? It means that everything will cost more. It also means that the value of the dollar will continue to drop. And what does that mean to me? It means that interest rates will likely increase. And what does that mean to me? It means that I may want to fix the interest rate on my home mortgage soon so that I won’t get caught in the future with a much higher mortgage rate that will cost me more money.

Question Everything

Question, question, question…and challenge the same old repetitive advice that you hear every day, week, month, and year. Question all advice that you hear and read. Question the “experts.” Question my team and me. Think for yourself. Ask the questions:

  • Does this make sense for me?
  • What are the pros and cons?
  • Will this get me to my financial goal?

Sometimes you may not know what questions to ask. Just keep asking because every question you ask is the right question if you’re smarter as a result and if it leads you to make better, more informed decisions about you and your money.

It’s time to think for yourself and question the routinely-accepted traditional advice so many people blindly follow. It’s time to discover which advice, information, and strategies work best for you.

Original publish date: November 07, 2013