3 People You Should Never Take Financial Advice From-Sheiresa Ngo

If you find yourself in a financial bind, you may be anxious to seek advice for how to manage your money. However, it’s important to be careful about where you get your advice. Don’t let desperation lead you down the wrong path. Bad advice could cause you to make a financial decision that will put you in a worse situation. Here are three people you should never take financial advice from.

1. Your broke friends

Broke | Source: iStock

Your friends may mean well, but if they never seem to have money, do you really want to take advice from them? Your best bet is to get advice from a financial professional. Steer clear of taking advice from anyone who is in worse financial shape than you are. The only lessons you should take away from them are what not to do with your money.
William S. Matthews, author of Everything I Needed to Know About Money I Learned from My Broke A$$ Friends, said learning from other people’s money mistakes can help you stay on course with your finances. “After countless discussions with friends, I was amazed and saddened by the money decisions many were making. The majority were living paycheck-to-paycheck,” Matthews told The Cheat Sheet. “Money management is about choice — choosing how to spend and save your money. Often, people’s material needs meet or exceed their income. Don’t shackle yourself with golden handcuffs (a luxury car, designer labels, and enormous debt).”

2. Financial “experts” without any type of financial certification

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Businessman | Source: iStock

Some people claiming to be financial experts have good advice. However, you should be leery of taking advice from anyone who is not certified or who hasn’t had any formal training in the area they are advising you in. Books and seminars are not enough when it comes to giving solid money advice. For example, if you’re looking for advice when it comes to developing a comprehensive financial plan, you’ll want to start by seeking the services of a certified financial planner.

The Certified Financial Planner Board of Standards has an online directory of certified planners. And if you’re in need of credit advice and help with debt management, a certified credit counselor can help steer you in the right direction. Check out the National Foundation for Credit Counseling website for more information on how to find a counselor.

3. Financial professionals with a bad reputation

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Man with money |Source: iStock

While certification is important, it’s also wise to make sure whomever you hire is in good standing. Barbara A. Friedberg, a former investment portfolio manager, said it’s important not to be blinded by fancy titles. “Don’t be swayed by pedigree. The advisor garners total trust because of their impressive educational background. There are unscrupulous advisors with degrees from prestigious universities. There may also be scammers in your church, alumni organization, or neighborhood group,” Friedberg told Investopedia.
Do your research beforehand. For example, if you plan to hire a broker, you can check for more information on FINRA’s BrokerCheck website. This site will tell you if a broker or brokerage firm is registered, what type of information was given to regulators, the broker’s experience, and what the broker is qualified to do.

Culled from wallstreet