Along your financial journey, you’ll come up to many people who think they know what’s best for you and your money. Many of them mean well—they might be close friends, family members, or colleagues who you’ve worked with for years. On the other hand, they might be complete strangers, forgetting to mind their own business.
In either case, it’s very tough to tell whether the advice is sound, and very easy to forget who’s in charge of your financial destiny—you! The situations vary:
- We’re in a desperate place and ask for help openly.
- Friends or family get excited about an opportunity that’s opened up.
- People perceive us as better off than they are, and try to project decisions they would make in our situation.
- People perceive us as worse off than they are, and try to help improve our finances by replicating how they got ahead.
The Problem with Advice
The fundamental problem with having someone else tell you what to do is that no one understands your financial situation like you do. You live and breathe it every day, you make the spending choices, the sacrifices; you understand where you came from and where you’re going, and what you hope to achieve along the way.
To have someone arrive and assume, however well-intentioned, that they can be fully empathic of your situation, or worse—dispense generic advice, is almost irresponsible. Dispensing any advice, but especially financial advice, should be done with the utmost humility and care. I have to be insanely careful with what I write here every day, and I’m sure some things still come across as assumptive.
Why We Fall into the Trap
Whether we mean to or not, we tend to follow advice from others blindly or adapt it to our own situation for various reasons:
- A desire to please family or friends by following their advice.
- Fear of rejection by those closest to you.
- Fear of failure, compounded by “I told you so” remarks from advice-givers.
- Perceiving advice received as common sense or the “right” way of doing something.
- Being scared of making decisions and wanting someone else to do it for us.
If you find yourself pressured to take other people’s advice often, it may be helpful to understand the causes behind your decisions as a means of getting past them and into finding a solution. Do you see the reason for your own way of thinking above, or is it something else entirely that drives you?
You Can’t Afford to Lose Control
As hard as it might be, and at whatever cost, we need to stay in control of our financial future. To do anything less would be a disservice to yourself and the equivalent of handing over your life to someone else. While being responsible for self may be scary for some, I believe it’s a critical step toward financial success.
You could, for example:
- Disconnect from negative influences entirely, or put a filter on your financial life and stop discussing it with people who dispense constant advice.
- Listen carefully to other people’s advice with an open mind, but let go of the need to apply anything but what you decide is best.
- Stop asking for advice just to have someone confirm what you’re thinking—most often, they won’t and you’ll be frustrated.
- Get a second (and third, and fourth) opinion on any topic you hear that worries you.
- Make a commitment, today, that your financial destiny lies in your hands and your decisions alone, and that you’re willing to take the responsibility for your choices.
Remember—most people want the best for you, and they mean well. But never misunderstand good intentions for a good understanding of what’s right for you!
Fiscal Fizzle 
Stick with your goals! Don’t let anything or anyone deter you.
Well said! Many investment mistakes can be avoided by following your instructions in this column. Very useful and accurate observations and very sound advice!
I’ve found that pushy people who are most insistent about giving advice are usually blowhards offering very poor advice. Because of my blogs, MBA, financial success, whatever, in my personal life people ask for investment and financial advice all the time. I’m usually on the more reluctant/high level side as opposed to doling out a bunch of advice. I also don’t volunteer my opinion; I only offer when asked. I have one family member that insists that I manage their money for them (or at least tell them what to do). I keep telling them to just call Vanguard and get a professional review from them as the most ethical/low cost institution I can think of.
And, when someone’s telling you about a great business opportunity (MLM)… run!
You’re absolutely right about the “money blogger” experience. The more I learn about money, the more I want nothing to do with telling other people how to handle it. I will, however, present a lot of options, and send you off to decide what to do! 🙂
This is an important reminder, because its easy to be swayed by people who you care about, and people who care about you. I once was swayed into selling some stock at rock-bottom by a boyfriend who warned me to “never hold in a down market.” I had a strategy, and if I had stuck to it, I would have been okay, but by listening to him I ended up selling at the bottom. He meant the best — he had good intentions — but it would have been better for me to stick to my guns. (Expensive) lesson learned!