No one looks out for your best interests like you. While your friends and family may want the best for you, but they don’t know or understand your best interests. Only you can determine and decide what is best for you. It’s great to ask for advice, but advice is providing you with suggestions and ideas. The final decision is always yours. If you have a partner in the transaction, of course you need to agree with your partner on the decisions you make. But, don’t let anyone who is not taking the financial risk push you around or tell you what you need to do with your finances.
Salespeople are interested in selling products or services and making money. Loan officers are interested in selling loans. Your best interests are the decisions that you feel comfortable with and those which you feel are the best for your financial situation. BOOM – MAKE YOUR OWN DECISIONS.
How many times have you observed someone make a decision and stated “my friends told me to do that.” BOOM – NO!” You should do what you feel is right for your life and financial situations. Likewise, they should do what is right for their life. People spend a lot of time thinking and worrying about what other people think they should do. That time should be spent on themselves; researching, evaluating and making decisions for their own lives.
Here are some statements to help you notice when someone else is pushing you to make a financial decision.
- “YOU ARE MAKING A MISTAKE” or “YOU WILL BE SORRY” – If you have a non-desirable outcome from a financial decision, that doesn’t make it a mistake and that doesn’t mean you will be sorry. Other people cannot decide your outcome or your reaction to the outcome.
- “I ALREADY DID THAT AND THIS IS WHAT HAPPENED” – It’s ok to listen to someone’s experience with an investment or purchase, but process that information through your thought process and reflect on your past experiences which might relate to the current situation.
- “YOU SHOULD DO THIS” – You should do what is best for you. You should make your own decision.
- “THIS IS THE BEST DECISION YOU CAN MAKE”- This type of statement is usually made by a salesperson. They may tell you that a decision is best for you when in reality it is the choice that would be best for them and will make them the most commission.
- “IT’S FREE TO SIGN-UP, YOU ARE RECEIVING AN 80% DISCOUNT, THIS IS A GREAT OFFER” – These may be great benefits to consider, but look at the entire picture, not just a few benefits. Evaluate all the costs, benefits, terms and risks before making your decision.
- “YOU WOULD BE STUPID TO PASS THIS OPPORTUNITY UP” – Someone is insulting you to persuade you to make a decision they want you to make. Making the best financial decision for yourself is not stupid, it is the smartest thing you can do.
- “IS THAT REALLY NECESSARY” – Someone is judging you and your life. You have the prerogative to determine if it is necessary as well as if it is something you just want and can afford.
Only you can make the best financial decisions for your life. You need to use your knowledge, skills and comfort levels to decide and do what is best for you. And you need to stand by your decisions and be content with them regardless of how they ultimately turn out. Remember, you will win some battles and lose some battles, but it’s better to be fighting your own battle and making your own decisions than blindly going with someone else’s direction.
RELATED STORIES
STORY 1 – A friend was telling me about an elderly family friend who had hundreds of thousands of dollars stashed away in savings accounts. This man’s children, who had nominal amount of money themselves, spend a great deal of time analyzing their father’s savings and giving him advice on how to better invest his money. He did not want to invest in stocks, bonds or anything he felt was risky. At one point, the children were very frustrated as they tried to explain to him that he could make 8% interest instead of 1% interest. Of course they felt they were right and could not understand why he would not make this change. They believed he was being very unwise. However, let’s think about this. The elderly man had earned and saved hundreds of thousands of dollars and had it safely tucked away. Furthermore it was very easily accessible. I believe that is his decision and no one else’s as this is the place he is comfortable and happy with his money. Not to mention, the children had been much less successful earning and saving money, and therefore, they really had no authority to tell him what to do with his money. If this elderly man had moved his money, it would have made him very uncomfortable. Furthermore, if he had lost any money on an investment he would have been extremely upset.
STORY 2 – My parents, who had worked hard and saved a small amount of money, decided to invest in mutual funds when they were in their 50’s. They were not comfortable with this type of investment, but their friends and family had told them that they would be very wise to move their money into a fund where they could make much more in interest. Hesitantly, they met with a financial advisor at their bank who talked them into not only investing in random stocks and mutual funds, but also tying up their money for two years. They knew very little about these investments and were guided by people who seemed to be financially smarter than they were. Unfortunately, a few months after they made a substantial investment, the stock market took a tumble and they lost a good portion of their investment. They were very upset and angry. They left their money in these account for the term they agreed to and cashed out with a loss. They would have been much happier and at peace with themselves if they stayed with what they were comfortable with: savings accounts.
STORY 3 -When I was in my 30’s, my grandfather passed away and my three siblings and I all received a little money. It wasn’t a huge amount, but more than any of us made in a month. One of my siblings paid off some debt and spent the money seemingly recklessly, another used it for a down payment for a car and another paid for some home improvements. I thought I would be the wisest one and invest in mutual funds. I felt very good about my financial decision. Well, shortly after I invested in these funds, the stock market declined significantly. Furthermore, I’m not the best at selecting great mutual funds, so the ones I selected were mediocre. More than a decade later, I cashed out these mutual funds for a little less than the original amount of the investment. I was disappointed, but I fully understood that I was taking a risk. I was proud that I made the decision which I thought was best and I was okay with the outcome. Besides, I still did have some money left after all that time.
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