Comments on: How To Handle Requests For Financial Advice

By: Flexo

Flexo — Thu, 25 Feb 2010 06:42:54 +0000

The question is what happens if the advice, whether good or bad, ends up being wrong. I don’t want to let my friends and family down, and I don’t want relationships to be ruined because they followed my advice, no matter how thoroughly disclaimered.

But I appreciate the vote of confidence!

By: Flexo

Flexo — Thu, 25 Feb 2010 06:39:11 +0000

Most of my friends know where I write and could visit if they’re interested, but I believe most are not interested. As far as future in-laws go, I haven’t really given that much thought. I imagine that I should have nothing to hide from someone who will be family, so I don’t mind it being out there. If I were dating, on the other hand, and a prospective date wanted to perform a Google-check on me… well, I’m glad I write anonymously.

By: Meg

Meg — Wed, 24 Feb 2010 17:33:49 +0000

I think you’re being a bit too sensetive about this issue, and perhaps almost disparaging of yourself and your knowledge. The fact is by many measures, you ARE an “expert” on many aspects of finance and are perfectly qualified to give basic advice when asked for it. Anybody asking you for advice is well aware that you are not Adam Smith or even a licensced financial planner. But that doesn’t mean they don’t want your advice, nor does it mean that your advice is not worth giving.

Surveys have shown that people seek and take financial advice primarily from family and friends. Smart folks will query a number of people – parents, relatives, friends in the industry – and even more responsible people will also read a book or do some extensive internet research on the subject before making a decision. If there’s a lot of money involved you can bet they are going to seek a banker or CPA or attorney for their input as well. There’s nothing wrong with encouraging that further due dilignece, but I don’t think you should hesitate to give your valued opinion when asked for it.

By: A Family of Geeks

A Family of Geeks — Wed, 24 Feb 2010 12:09:45 +0000

Number 3 is so important. If you ever feel the need to drive away friends and family within minutes, go ahead and give them unsolicited financial advice. There have been so many times I’ve had to bite my tongue to stop myself, but it’s worth it.

By: Fern Alix LaRocca CFP®

Fern Alix LaRocca CFP® — Wed, 24 Feb 2010 05:03:24 +0000

I write about pre-retirement issues and my friends are readers of my newsletter but we don’t talk about our personal situations but the financial world at large. People know that this is how I make my living so they don’t impose themselves on me with questions about their finances. I do offer resources and tools in conversation every now and then. I feel strongly that personal finance is just that- personal. Everyone’s needs, risk tolerance, and tax situation is different and really can’t be addressed in an article.
Fern Alix LaRocca CFP®

By: Evan

Evan — Tue, 23 Feb 2010 21:53:53 +0000

I think the best piece of advice is “Determine your friend’s true intent”

You are a friend first not a money expert…and it might just be the very fact they are looking to someone to bitch and complain to that has some understanding of what they are bitching and complaining about.

Do a lot of your friends know about your blog? All my friends know OF my blog but not a sole knows the domain. As I get braver putting information out there (investments, holdings, etc) like you do in your awesome recap I’d feel weird about putting it out there for friends and family. Would you want you future mom in law or brother in law knowing your business?

thoughts?

By: Revanche

Revanche — Tue, 23 Feb 2010 19:10:36 +0000

I’ll admit I had the very same thoughts as you on TM – if there was still any cash left in my investing account, I would likely have bought as well.

Over the years I’ve developed a reputation for being very careful with money, and thereby good about it (though they couldn’t prove it) so some friends frequently come to me for advice. While I’m happy to help, it’s usually in the form of research so that they can make their own decisions. I definitely stay away from offering unsolicited advice especially when the answer I’d give is not the advice they asked for.

For example, when last asked about loan options for a new car, my reactive answer was “Don’t” because from what I know about their financial situation, they can’t afford it. But it’s important to understand they’re not asking for help with making that decision, they just want to know the best options they have given that decision has already been made.

By: RainyDaySaver

RainyDaySaver — Tue, 23 Feb 2010 18:46:45 +0000

Hold on to that Toyota stock. I don’t think the company is dead in the water, yet.

The timing of this post is great, as I’ve just navigated through a request for financial advice this week. Luckily, it was only about ways to save money, and I could safely offer my advice on that subject — who could get mad at you for saving them money by cutting back on expenses? But for more complicated matters, like investing or mortgages, you definitely have to redirect folks to the experts.

By: WellHeeledBlog

WellHeeledBlog — Tue, 23 Feb 2010 18:13:57 +0000

Exactly. I read this disclaimer in a popular blog written by a doctor: “I’m a doctor, but I’m not YOUR doctor, so I can’t answer your medical questions.” Along the same lines, even if you are a financial “expert” (or accountant or lawyer or certified planner), you’re not your FRIEND’s financial expert.

By: Investor Junkie

Investor Junkie — Tue, 23 Feb 2010 16:42:05 +0000

Regarding TM.. don’t worry about it for the short term. In fact, it hasn’t even been a month since you have owned the stock. WAY too short term thinking. In fact, I would double down on Toyota. Long term Toyota is fine, and isn’t going anywhere.