When you make that first, all-important decision to enter the immensely impressive and confusing world of investing, you’ll find yourself on the receiving end of all sorts of unsolicited advice. While some (but probably not all) of it is well meant, it’s important to keep in mind that investment decisions are best made according to your own needs and your own plan for what you’re aiming to achieve via your investments.
People’s needs, expectations and risk profiles for investing are as individual as they are. Most people start by speaking with financial advisors or wealth creation experts, or by taking a few courses. In any case, below is a short list of people you might want to avoid when it comes to investment advice.
This is usually the sort of person who talks to you incessantly about a ‘no risk’ investment, and what a ‘sure thing’ their deal is. Beware the promise of high returns and no risk. This is the real world – there is no such thing as risk free investing. At best, this sort of person is a dreamer. At worst, they’re some kind of scam artist. They may really believe in what they’re trying to sell you, but that doesn’t mean you have to.
Ever been to an investment pitch and asked a few questions? Come away with no clear understanding of what the investment really is? What the risks and rewards might be? Asked your queries, only to have them brushed aside? Some so-called investment consultants are very good at saying a lot of words while giving out no useful information at all. If they cannot answer your basic questions clearly and concisely, you might want to get out of there – fast – and take your money with you. Either they have little to no understanding of their investment product, or they really are dodgy. Either way, your money is better off elsewhere.
This one’s infamous… “Sign up today, this deal won’t be around tomorrow – need a pen?” This is how people end up owning swampland instead of investment units, and buying shares in companies that don’t really exist. If there is an inordinate amount of pressure on you to sign something right away, with no time for you to get it legally checked out, you should be hearing alarm bells clanging loudly in your head. You may miss out on the deal of a lifetime by insisting on taking your time to have a lawyer check it out – but it’s more likely you just saved yourself from an expensive mistake.
That Guy Down at the Bar
Everyone in the bar has an opinion on investing, but ask yourself this: If the bloke in the pub knows so much about investing, why is he sitting there in the middle of the day? Unless he’s Warren Buffet stopping in to check out taking it over, keep walking.
Strangers Who Don’t Know Your Circumstances
If you take advice from a successful investor who isn’t focused on the same outcomes as you, you will likely not get the results you want. Your investment decisions should be made according to your needs and plans – no one else’s.
It bears repeating; everyone’s investments are very personal decisions based on where they think they want to be. No one else knows your plans, and your circumstances, better than you and your family. No one is better placed to advise you than you yourself. Trust your own instincts, even if you’re a novice investor. You know yourself and what you’re comfortable with, better than anyone else in the world.
Who would you never take investment advice from? Share your stories in the Comments box below.
The information provided in this article has been provided as general advice only. We have not considered your financial circumstances, needs or objectives and you should seek the assistance of your GPS Wealth Limited (GPS) Adviser before you make any decision regarding any products mentioned in this communication. Whilst all care has been taken in the preparation of this material, no warranty is given in respect of the information provided and accordingly neither GPS nor its related entities, employees or agents shall be liable on any ground whatsoever with respect to decisions or actions taken as a result of you acting upon such information.