Who do you turn to when you need financial advice? The video below might seem funny, but worse things have happened to people seeking financial advice.
When you are in a tough position financially, basic human instinct will force you to seek advice and help from other people. This is not a bad thing, but where you seek advice might leave you in a worse position than you were before. These are some of the problems you might face when seeking advice.
Many people like to pretend they are more knowledgeable than they actually are. Since knowing something about money makes one seem knowledgeable, many people will give you advice even when they have no clue what they are talking about. It's up to you to filter out poor advice.
Be Wary of Selfish Interests
How many people have been conned when in dire financial need? Nobody can really tell the actual number, but almost everyone knows of someone who has preyed on innocent people when they are in dire need. At such a point, one is usually desperate and will do anything to appease the one offering help. If the advisor you are seeking help from has bad intentions, you will find yourself in a tricky situation.
What to do
Unfortunately there is no single way of avoiding getting bad advice or being ripped off by 'advisors'. However, it is possible to minimize the damages. You can do this by:
- Confirming what others tell you before you take any other step. You can do this by presenting your problem to different people. You can also discuss the advice you are given to others to gauge their reaction.
- Taking your time before implementing any suggestion. Things can always get worse so there is no harm giving yourself a few hours, days or even weeks before you take any action. This will help you establish whether things add up.