This article has been reprinted with permission by NerdWallet
There are many people who would like to tell you how to spend your money. The problem is that not all of them know what's going on.
It doesn't matter if it's your friend offering a valuable investment tip or a relative who gives outdated advice about how it should be done, or a social-media influencer hawking a popular financial product. Money advice can be a mixed bag. You can filter the good bits and ignore the rest. However you must know how you can evaluate which advice you can trust.
All certified financial advisors, coaches, and non-profit credit counseling agencies are able to provide advice tailored to you. When you accept their advice, don't forget to ask for a recommendation. By doing so, you will know that you are receiving objective guidance.
Additional bonus: You will also be given a thorough explanation of how the various financial products function, which can prove to be very useful for you over time.
"Financial matters tend to be complex, and I think that's why it's so important for individuals like myself to have education as a large part of what we do," says Durriya Pierce, a certified financial planner and financial advice expert at Albert, a financial services company.
An old friend or relative might have some useful tips for you. As you work toward your goals, it might be possible to draw on their emotional support.
Some of the old wisdom may still hold some value. When you next hear someone talk about how cars cost a nickel in the past, instead of laughing in disbelief, be open to asking questions. How much was your grandfather paid at his first job out of school? How much did your parents' first house cost? You can have a good conversation about how the salaries and housing costs have changed over time so that you both can understand each other's point of view.
Phuong Luong, a Massachusetts-based certified wealth planner and founder, of Just Wealth says that it eventually becomes less about the sharing of advice and more about the sharing of their story.
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Money advice is like clothes. It is made to fit you, but it might not fit you. Some money best practices won't work in every case.
"So often, people ignore the context of their lives." Luong explains that financial advisers don't provide the context. It's actually harmful when they don’t. It perpetuates the myth that it's possible to do this by ourselves.
As an example, she cites the much-discussed 50/30/20 budget. This is where 50% of your take home pay goes to "needs" such as housing, utilities, transportation, and 30% to "wants". 20% of that money goes to savings and debt repayments. In high-cost areas, she notes, rent alone might eat up half of your take-home pay.
Bad advice can also make a difficult decision more simple. To save money, you might be suggested by a friend to simply move to another city if you have more remote workers. Pierce, who lives in New Jersey's high-cost region and does not plan on moving, claims that this advice ignores non-monetary benefits such as the proximity to family and friends.
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Clickbait that promises quick success is commonplace on social media and the internet. Many influencers claim that they can make you a millionaire by offering expensive courses. A lot of high school friends will send you messages asking you if you would like to be your own boss by joining a multilevel marketing organization. Many of these "get-rich-quick" schemes are a waste time and money.
Luong said, "If you need to deposit money upfront, that would indicate that it is not a good deal." She suggests that you carefully examine these offers, including reviewing reviews and looking into any comments.
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A trusted money guide is not going to promise you a guaranteed income. Look for advice that fits you, but gives you realistic expectations and a few alternative courses of action.
Pierce warns that you should be wary of financial advice that appears to be in black and white. It's a grey practice.
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NerdWallet: Sara Rathner Email: srathner@nerdwallet.com. Twitter: @sarakrathner.