When it comes to financial advice, you want to be careful who you listen to. Not everyone is as well informed as they believe, and they may not have your best interests at heart. Therefore, finding the right financial advisor is crucial to your financial planning. So if you are looking for expert guidance, these are 3 people you should never take financial advice from.
3 People You Should Never Take Financial Advice From
1. Family and Friends
Your family and friends usually have the best of intentions. When they offer advice, it’s because they think it will benefit you. But unless they have a financial background, you should never take advice from them.
First and foremost, every financial situation is different. Since you are at different stages in life, you will have different approaches to investing and financial planning. Not only will you have different risk tolerance levels, but your needs and long-term goals may not align with theirs. Additionally, the market is constantly in flux. Their advice may be based on economic conditions that no longer exist. Your situation is unique to you, so it’s best to leave the financial advice to the professionals.
2. Social Media “Experts”
If you want to learn about financial topics, a quick search on YouTube will bring up thousands of results. Many of these videos have been posted by self-proclaimed “experts.” Don’t get me wrong, there are some very smart people creating content out there. However, it can be difficult to distinguish good from bad advice in the age of social media.
When you subscribe to these channels, be mindful of their motivations for creating content. Some may offer advice because they have sponsorship from specific institutions or earn a commission when they sell financial products. Or, you may run across forums like r/WallStreetBets that give extreme and often outlandish advice which is counterproductive for those trying to build wealth.
While social media channels will keep you current on market trends, it’s wise to discuss any financial moves with your advisor. This will prevent you from making mistakes you will later regret.
3. A Bad Financial Advisor
It’s important to choose a financial planner who understands your goals and works with you to achieve them. Therefore, you want someone who offers advice that is in your best interest, not theirs.
If you recognize any of these signs that you have a bad financial advisor, then it’s time to reconsider your situation. You want to find someone who you feel comfortable discussing these topics with and whom you can trust with your life’s savings.
As with most major decisions, you need to do your research. Look into the background of potential advisors and ask questions. And, avoid anyone that has many dissatisfied clients or poor reviews. When it comes to securing your future, you don’t want to take any chances just to save a buck.
Read More
- Hiring a Financial Advisor vs Managing Your Own Money
- Can You Sue Your Financial Advisor for Losses?
- Can Robo-Advisors Save You in a Volatile Market?
Jenny Smedra is an avid world traveler, ESL teacher, former archaeologist, and freelance writer. Choosing a life abroad had strengthened her commitment to finding ways to bring people together across language and cultural barriers. While most of her time is dedicated to either working with children, she also enjoys good friends, good food, and new adventures.