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The other big reason Financial Planning is hard – bias. #FinancialPlanning

Financial Planning is made more difficult than it has to be because most of the people pitching solutions are biased. The vast majority of people who claim to be financial planners are sales people for large banks, brokerage firms, and insurance companies who get paid by selling the products their companies want them to sell.

These large companies through their armies of sales people and billion dollar advertising budgets dictate the message that consumers hear, and it is not based on sound financial principles, which rarely change, but rather on what is the “hot” or “quick” product or idea in the news, and what the companies think they can sell to their target audiences and the media. The result is that those messages change constantly leaving most consumers terribly confused.

Most books don’t help either. Generally, the popular books about financial planning and investments fall into three main types: some are focused on investing in stocks or mutual funds; some are personal finance books that usually preach the value of saving and budgeting; and some offer some number of tips centered upon a specific subject like mutual funds or estate planning.

These books are all also geared toward people who want to do everything on their own. If you have the confidence, the knowledge, and the ability, that’s great, but not everybody does. I think that most people that think they are qualified are fooling themselves and should make sure that they are looking at the issue objectively.

There is information out there. The problem is finding the time to figure out what is the relevant information for you. Can you figure that out? I’m not so sure most people have the time or the right skills. I think your efforts should be focused on finding the right independent financial planner who can tailor advice for you, and those efforts are more likely to be fruitful.

Michael Garry Yardley Wealth Management

Author Michael Garry Yardley Wealth Management

Michael Garry is a CERTIFIED FINANCIAL PLANNER™ practitioner and a NAPFA-registered Financial Advisor. He is a member of the National Association of Personal Financial Advisors (NAPFA) and the Financial Planning Association (FPA).

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