Devil's Advocate 
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Ignore Personal Finance Experts

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This is a Devil's Advocate post.

What do Suze Orman, Robert Kiyosaki, David Bach, and every other personal finance expert out there have in common? They don’t know you but they know exactly what’s wrong with you and how to fix it. Suze Orman thinks you’re a moron, that you need tough love, and that those 0% financing offers from Ford are awesome. Robert Kiyosaki says that you suck like his poor dad (who isn’t real), you should aspire to be like his rich dad (who also isn’t real), and that you should buy one of his books. David Bach thinks, without the indignation that comes with a Suze orman, that you should get out of your own way and make things automatic. I think you should ignore personal finance experts… all of them.

You might think this is a self-serving Devil’s Advocate post – and it is, because personal finance bloggers aren’t experts. Then again, bloggers don’t treat you like crap and tell you how you need a wake-up call (that’s Suze), bloggers just write about themselves and invite you to check out how normal and bad at personal finance we are. Experts? Heh, totally different animal… here’s why you should ignore them.

Cater To The Masses

This isn’t really their fault, it’s a product of the marketing machine that drives their popularity. On the web, you have folks who talk about themselves and by nature fall into a small niche. You have the family of six, you have the bloggers battling debt (or just finished), you have a fee-only certified financial planner (JLP has never ever written a post selling his services), you have the husband-wife tandem, and you have a whole host of other blogs that fall into one niche or another. None of those sites are trying to be everything, they’re only trying to be themselves and therein lies their popularity. When you graduate, you perhaps find the debt bloggers and the tandem bloggers to be your thing. As you get older, you might find the family of six or the CFP blog more your style. With so many options, you can find one that works for you.

Too General

Since they cater to the masses, usually their advice is too general to be of true value. I’m not saying that bloggers are better in this case, I’m just saying that experts aren’t going to give you the level of advice that you need. I’m also not saying you should run out to a financial planner and pay for advice, I’m recommending that you ignore the big names in the bright lights and read articles written by folks who aren’t so keen on hearing or reading themselves. Read from the perspective that you’re reading valuable information that may not be valuable for you. Don’t read from the perspective that you’re going to do the next thing that comes out of an expert’s mouth. Experts in any field are wrong often enough that listening to them 100% of the time will result in disappointment.

Accessibility

A product of their popularity is the fact that experts simply aren’t accessible. You can certainly try to ask them a question but the reality is that an answer won’t be thought out and personalized. If anything, you might get it read on-air and get a simple 30-second response (or a 5 minute chastizing). Why is accessibility important? It’s not tremendously important but if you have a specific problem and you want to hear an experts opinion, the likelihood of them happening to answer that problem is zero.

Was that a compelling enough argument against experts? Maybe, maybe not, please let me know. Think I was too harsh of Suze Orman? (I don’t think I was as harsh as she generally is) Think David Bach shouldn’t have been lumped in with the experts? Fire away!

{ 15 comments, please add your thoughts now! }

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15 Responses to “Ignore Personal Finance Experts”

  1. Jeremy says:

    I don’t know if I’d classify this as a devil’s advocate post since it is more or less the truth. Like you said, people like this give out general advice that may or may not be applicable for your situation. Sure, the message is sound: save more, spend less, get out of debt, avoid high-fee investments, etc. But aside from their popularity in the media, you can get the same information anywhere.

    The bottom line is that you need to remember that all of the “experts” you see or hear are selling something. They are selling books, audio tapes, online courses, workshops, seminars, etc. They shill their advice in order to hopefully generate more sales.

    There is nothing wrong with this, it is a business just like any other. But you have to consider that they are tailoring their message to the masses so that they can appeal to the widest audience that can then capitalize on more sales.

    So I think your assessment is right on. You should generally ignore the experts. Sure, they may have some reasonable advice to dish out, but it won’t work magic in your own situation. You have to dig deeper and really apply what you’ve learned, or actually seek individual help in order to really make a difference.

  2. pfodyssey says:

    Generally, it’s basic supply and demand. These people you mentioned have the supply (direction and advice) to meet the need that is out there (people who want direction and advice as it relates to personal finance).

    I don’t see it as any different than weight loss. For example, some people can do it on their own, while others need more help (ex: personal trainer). Similarly, for those that seek help, they will excel with one who also matches their psychological needs or personality. Look at the show the Biggest Loser – You have Bob the shoulder to cry on…and Jillian the one to tell you to quit being a baby. They both deliver the same essential product…but in very different ways.

    Although I personally wouldn’t pay for the advice their peddling, I can understand why someone else might.

  3. Mike says:

    I largely agree with this comment though there are a few exceptions. Most often I find find the advise is too general like other comments mention, “spend less”, “save more” etc. that does not help much. Also, another thing I have noticed is that the topics are too me too – just about every professional advisor is offering the same content – FSA, IRA, coupons etc., so nothing new really. Of all the advisors on Yahoo, I feel Prof. Guttentag has something new to say as he talks about the mortgage industry that I am not so aware of. What I like about the bloggers is I can emphathise with many of the comments and challenges they come up with. The situation may not identically apply to me, but, helps me think on how to customize the approach to my requirement.

  4. Lord says:

    The solution is to become your own expert. Learn everything you can and that includes these experts as a start, but it shouldn’t be the end.

  5. Kory N says:

    I agree with “The Lord” a person should become there own expert. No one will care more about your money then you. Oddly enough some of the personal finance writers agree with this too.

    But you have to start learning some were and Bach, Orman and the like can be a good place to start.

  6. Great post. I agree with Jeremy when he says he isn’t sure about it being the devils advocate, because it is the truth.

    We all have our own styles and attract a different type of reader.

  7. Matt says:

    Yes, i do agree with Kory’s statements. As now a lot of experts are just focusing on the money and not providing the solutions or really care the needs of us.

  8. Tim says:

    I agree that this isn’t really a devil’s advocacy posting. There is nothing new that these people offer, they simply offer something repackaged in a way that tease people who have an insatiable appetite for that “thing” that will make them rich or richer.

  9. Aaron Stroud says:

    Jim, funny post but thought provoking as well.

    There is a reason why these “experts” can make a good living giving basic advice. Some people really are benefiting from the advice. Sure some of the books are sold to people intending to give them away, but not all of them.

    Sometimes people (myself included) have to hear a message a couple hundred times before acting on it.

  10. Meg says:

    I disagree that “financial experts” such as Bach, Orman, and even R.K have little to offer. I am very savvy and financially literate, but I read “Smart Women Finish Rich” and “The Automatic Millionaire” by David Bach and received a framework for financial planning that I didn’t already have. I read “Young, Fabulous, and Broke” by Suze Orman and learned about buying cars, furniture, and all sorts of other tid-bits (which would have been even more useful if I hadn’t already read Bach’s books). And then I read several R.K. books which (while offering few particulars) led me to think more like an entrepreneur and gave me confidence to start making real investments–which I have done successfully now.

    Most people who reach out for financial planning books can and do benefit hugely from the “general” financial advice that is offered. Where else can you learn about the particulars of 401k investing, IRAs, emergency funds, financing education, and budgeting? Sure, online or at PF blogs, but that’s not where most people go unless they’re ALREADY financially literate.

    Dont’ bash the simplistic, general personal finance books. They boosted me to where I am, and they help countless normal people start to make plans and goals–and reach them.

  11. moneymonk says:

    I have to say I have learn something from each of the experts you mentioned. You just have to take it with a grain of salt. I tell my readers that Personal finance is “personal”. Take out what every experts says that will work for you. Not all there advice you might agree with. So I will not eliminate experts entirely.

  12. In the end the only person that will make a difference is yourself. All of the authors list advice. No one author has every answer. It’s up to you to figure out what works for yourself. Until you take your financial situation in your own hands it doesn’t matter what these books say.

  13. Jan Dillaha says:

    There is no substitute for taking control of your own finances. There is no way that any of the financial gurus can speak to all of the nuances of any individual’s situation. Saving money is a matter of choices/priorities.

    The problem is that we are being sold so many things at any given time. “Debt is good, debt is a tool, plastic is faster than cash, etc.” Most of this stuff is a lie, but we hear it so often that we act as if it is true. So many people are living on a knife edge financially because they believe this stuff.
    Going against that current is hard work.

    The value in listening to the common sense approach of many of the financial gurus is that you get to hear that living on less than what you make still works. You can become wealthy by living frugally, watching every penny and saving as much as you can, starting as early as you can.

    They can help to keep you motivated and encouraged to stick with a plan that runs counter to every marketing pitch you hear or see.

  14. Julie says:

    I agree with your post, and I’m glad people like you are saying that.

    While I have learned valuable things from some books and authors, their advice is not the panacea that they often revered as. While the advice in their books may be useful – sometimes very such so or even life-changing to some depending on their particular situation and the point they are at in their lives – it’s very hyped and there’s heavy marketing to make you buy more and more of their stuff. They’re only applying their own advice, right? How to get rich! At one point, there’s a point of “diminishing returns” with respect to how much money you pay to learn the “financial secrets that will guarantee you unimaginable wealth!”

    Cheers, nice site!
    Julie

  15. I do believe that personal finance is personal.

    Also I do believe in Myer Bridge personality types that people are hard to change from one type of personality into another.

    But why do I have to ignore advice from PF experts if this is applicable to me?

    The thing is to find correct things for correct people. I never heard Robert Kiyosaki or someone say a pianist MUST be come an investor.


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