Comments on: The “Die a Slow Death” Effect of Investment Dependence

By: Mike Piper

Mike Piper — Fri, 05 Mar 2010 03:31:30 +0000

I think you’re right that people tend to put off learning about something until the need is immediate and very apparent.

At the same time, I suspect that encouraging “you can do it.” sort of messages may be more effective at actually getting people to get started than messages along the lines of “if you don’t get started now, you’re done for.”

By: MoneyNing

MoneyNing — Fri, 05 Mar 2010 00:48:15 +0000

Any investments, foreign, or not, spur economic growth. However, dependence on ANYTHING is not a good thing, and can eventually backfire.

By: MoneyNing

MoneyNing — Fri, 05 Mar 2010 00:47:20 +0000

A false alarm would be good to get everyone more alert but I hope that no one will suffer the trauma that we just experienced in the financial markets ever again.

By: Shaun McGowan

Shaun McGowan — Thu, 04 Mar 2010 23:43:48 +0000

Does dependence of a national economy on foreign investment promote economic growth or underdevelopment?

By: Vicky

Vicky — Thu, 04 Mar 2010 21:51:29 +0000

Speaking of 401ks, I hope that they will actually approve the annuity option for 401ks. It would be good, as many people can benefit from consistent and dependable monthly paycheck.

By: Jorge

Jorge — Thu, 04 Mar 2010 18:50:25 +0000

We are the same way with our health and our investments. Unfortunately, few care about obesity until they are having diabetes. Unfortunately, few care about investing until they retired and have no money.

If we can only find a way to scare the heck out of everyone, we would all be more educated about what would make us better long term.

By: MoneyNing

MoneyNing — Thu, 04 Mar 2010 17:45:25 +0000

The other benefit of having some knowledge is that you can ask more specific questions when you meet with your financial advisor. By doing so, it forces him/her to think before they give you their usual sales pitch, and you end up getting more out of each meeting.

The other benefit of knowing something is that you are better able to tell the financial advisor information that he/she needs in order to create a better portfolio or investment plan for you. They can only remember to ask you so many questions after all, so the more relevant info you can offer, the better the result.

By: Mike Piper

Mike Piper — Thu, 04 Mar 2010 17:32:22 +0000

You raise a good point about the level of education required to call oneself a financial advisor. It’s nowhere near that of a doctor.

Two good tips for looking for advisors are to look for somebody with a CFP or CPA certification and to look for somebody who isn’t paid via commission.

By: 2 Cents @ Balance Junkie

2 Cents @ Balance Junkie — Thu, 04 Mar 2010 16:32:29 +0000

The doctor/financial advisor analogy is great. Advisors often equate themselves to “financial doctors”. I’ve never met one that qualifies for this distinction, and, although every doctor I’ve ever consulted definitely knows more than I do about medicine, I’ve met a few advisors that knew less about finance than I do.

Beware of advisors that are just marginally knowledgeable salesmen. I’m sure there are some good ones out there, but this field is not as regulated as the medical profession and they seem harder to come by.