Why Your Best Financial Adviser Might Just Be You.
After a few years of seeking out financial advice, be it paid or for free it eventually became very apparent to us that a lot of the professionals in the field had an ulterior motive which was to simply sway opinion towards whatever product they were offering. The incorrect naive assumption we were initially making was that the advice was independent. Our experience in this field ended abruptly and for us comically with our financial adviser actually firing us because we couldn’t find any value in the funds he was offering, it was no longer worth his while having us as customers so he cut us loose. It was definitely the best decision all around. We never realized it at the time but he definitely did us a favor.
It was the same issue we seemed to experience when we subsequently began using the internet as our financial advice source. After the physical financial adviser experience we viewed every piece of printed advice with suspicion. In those instances it seemed like there was always an agenda that someone was pushing for whatever reason. In some it was that they were pushing a popular viewpoint or investing style in trying to get more clicks to their website.
For others it just felt like someone was in an investment and wanted their stock to increase in price in order to offload it or trying to scare us out of our particular stock to cover their short position. Like we never really knew the full story and were being manipulated as a result. The financial industry is very big business with a lot of people making a lot of money based on our inexperienced bad decisions. To us this was and still is a large part of the problem.
The end result was that it became very stressful for us to try to filter out the forest from the trees and we had no idea where to look for true and meaningful, non-biased advice. For a while the investment world was off limits to us because the frustration led to inaction and to be honest, total lock-down. We took a hands-off approach and left investments on auto-pilot or in cash because getting involved led to too much heartache and frustration stress. We took the decision to put a pin in it and ignore the noise, this seemed to work best while we tried to figure it all out.
We only started to find success and much less stress when we decided to take matters into our own hands. It made sense to start thinking logically and more intelligently about what we knew and what we didn’t know. We simply began to only ever work on facts instead of the opinions which had led us up the path to suspicion and inaction for so long. It sounds really simple now but it’s surprising how long we struggled with such a very basic concept.
The first step was simply to only listen to the people that interpret the financial landscape and control money flows, that is the Federal Reserve. We fully believe in the saying “don’t fight the Fed” and we believe it’s very important to keep up an understanding of all the wording that comes out of the mouths of money controllers in the country for good or bad and to invest as appropriate. This does not mean listening to the interpretations of Federal Reserve statements by any financial journalists nor the internet. On the contrary, it is simply to read the transcripts or listen to the information that is given to us directly for free and interpret it for ourselves. If we don’t understand something which is said then we make it our mission to understand it such that our financial future depends on it, we can’t afford to be lazy on this.
The only other habit we formed was to read with interest the quarterly transcripts of the companies that we are invested in and how they interpret the financial landscape they operate in. These are companies who’s very existence is at stake if they misunderstand the environments in which they run their businesses. Obviously within their statements it is important that we understand that they are following a political protocol to keep us as investors happy and invested. We find that the bankers Q and A sessions at the end of the calls provide the type of questions that we should be asking for ourselves. Again it is in our best interests to understand the questions and the answers and how they originated.
So if we are looking for financial pointers, in our experience these are the main two areas where we now look. We find this approach keeps it simple. We still believe it is perfectly fine to read all the financial websites and brokerage information available and understand perspectives which differ from ours, taking on board their explanations. But the most critical part is that these are only ever opinions or interpretations for entertainment only. As opposed to facts that need to necessarily be acted on.
Since we adopted this do-it-yourself mindset we haven’t really had much investing stress nor confusion. We also own our mistakes as humans and if we misinterpret any information for any reason then we accept the error and understand that we need to be smarter next time. Becoming our own Financial Adviser has involved taking responsibility for our own actions. It has put us in the drivers seat of our financial lives where we should have been all along but didn’t know how.
We are not saying this approach is for everybody as it requires a lot of time, effort and patience to fully understand the information as well as an underlying acceptance that mistakes will be made that will need to be learnt from. You may have found an adviser or source you trust which truly is independent in a way that we never could, in which case we are truly happy for you. We just find that taking independent responsibility for our own financial decisions has been very liberating and considerably less stressful, in reality it was the best thing we ever did.
Thanks for reading.