We live in the information age, and with that comes the benefit of information and opinion at your finger tips. Whether that be online in search engines, AI systems, websites, online groups and threads. This in addition to the previous sources that people have consulted such as the mainstream media, friends and family, work colleagues or even ‘Dave down the pub’.
So with all of this information available across all areas of personal finance, it can understandably be difficult to know what to believe and who to listen to.
From personal experience that has meant more people coming with some existing opinions and ideas which can lead to more interesting and detailed conversations, but also some challenges of people with pre-conceived ideas and fixed opinions.
Whilst some would say ‘knowledge is power’, this is only true if this is the right knowledge applicable to your own situation.
So before I get into who you should and shouldn’t be listening to, I would say it is important to think about the following four things:
1. The source of the information you are being providing with – is this actually credible and backed up with some reasoned and reasonable data or thoughts
2. The motive behind the source providing it – is this to take action to their specific belief, product or service or is it to genuinely help
3. Consideration to any potential biases or limitations in the information – is there something obvious that has been excluded and there should always be the ability to see both sides
4. Is what they are saying relevant to your own personal context – I would always say that financial planning is often more art than science which means that even similar people may have different needs and solutions.
Who I wouldn’t be listening to:
Anyone with a vested interest that involves only using their product/service – where there will significant upside only where you take on their thoughts and recommended actions.
People who have no ‘skin in the game’ – where the consequence of being wrong has no impact to them. The example I would give here is journalists – it makes no difference to them whether they are correct or not as there will be a new story and item to discuss the next day.
People without any deep knowledge or specialism with the subject – this would exclude social media influencers,
Therefore, who should you really be listening to?
Well … me of course! But joking aside to be more specific it should be:
People with deep knowledge in the subject matter – I wouldn’t have much sway or strong opinion on how to repair a car engine, but I would on how to optimise a person’s finances.
People with professional knowledge and experience – the saying that you need ‘time on the tools’ and evidence of other people’s success such as online reviews or recommendations from others over a sustained period of time is relevant here.
Credible sources with a legitimate and reasonable motive for your outcome to be successful with a track record of this over time. People where it would have an impact on them if you weren’t successful.
And with everything in life, never be afraid to ask the question or give your thoughts! I would always rather answer a high number of questions and be challenged than for someone to sitting there wondering.
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