One Financial Planner On Common Money Mishaps She’s Seen — And How To Avoid ThemFebruary 5, 2019
The recent stock market volatility has made it an even trickier time for people to manage their money.
CBS News business analyst Jill Schlesinger has advice on how to avoid some of the pitfalls, based on a wide range of mistakes she’s seen in her experience as a certified financial planner and host of the radio show “Jill on Money.”
Here & Now‘s Jeremy Hobson talks with Schlesinger (@jillonmoney) about her new book, “The Dumb Things Smart People Do with Their Money: Thirteen Ways to Right Your Financial Wrongs.”
Here are a few of Schlesinger’s tips for making savvier financial moves:
Don’t Invest In Something You Can’t Understand
“I mean frankly, if you can’t understand it easily within a five-minute description, or someone says, ‘Please read this 180-page prospectus, you will understand more,’ then you can avoid it,” Schlesinger says, “and you can always listen to the butterfly in your belly, or get a second opinion and really be cautious. Because this is an industry that is wonderful in terms of giving people opportunities, but [there is] also the dark side where you have some unscrupulous folks who are selling stuff just to sell it, not because it’s best for you.”
When’s The Right Time To Talk To A Financial Adviser?
“I would say that there are a lot of people who seek financial advice when really, they don’t need it,” Schlesinger says. “You know what your big three goals really need to be, which is: I’ve got to pay off that consumer debt, I’ve got to pay down those student loans, I’ve got to have my emergency reserve fund and I’ve got to start using some sort of retirement plan. If you don’t have those three things, there’s no reason to go to a financial planner. You can buy insurance online, it’s very easy to do the calculations. But if you have a complicated financial life, or if you and your spouse are fighting a lot about money, or if you are up at night worried about money, those may be some of the signs that you need some financial help.
“And just a plug here: Please get help from an adviser or a professional who is held to something called the fiduciary standard. That means they have to act in your best interest, not his or hers or the firm’s.”
Buying Gold Is A No-Go
“When you see anything advertised really late at night when you have insomnia, it’s probably a pretty good idea to avoid that,” Schlesinger says. “I put gold in that category, reverse mortgages in that category — I mean every washed-up, B, C star ends up being in these commercials. One of the biggest problems with gold is if you’re going to buy physical gold, it’s really hard to unload it, and it’s expensive, and you don’t know what you’re doing and commodities are really volatile.”
Everyone Should Care About Insurance
“There is no better product that can prove the law of large numbers and the ability to spread out risk,” Schlesinger says. “I mean look, the big problem about insurance — whether it’s disability, long-term care, life, health, any of these things — is that in…