Is Financial Advice A Disservice?

In many of my articles, and those of other writers, a common theme can be found. Most financial writers, myself included, tell people that they have to choose what to do with their money. We advocate choosing between life experiences like travel and the accumulation of stuff and gadgets. We tell people to choose between the small meal out today or saving for the larger goal later. We tell people that if they want to do or own certain things that they must give up others. We advocate a trade-off system where the things you need and want most get priority and the things you want less take a backseat or get forgotten altogether.

We tell people to make these choices because most people have a finite amount of money. It would be nice if we all had enough money to do and have everything we wanted. If we all won the lottery tomorrow, such choices wouldn’t be necessary. But for most people who live on forty or fifty thousand dollars a year, or less, choices are a fact of everyday life. If the family wants to go to Disney World, they have to find that money in the budget somewhere and that comes from cutting someplace else. If someone wants to save a lot for retirement, they likely have to settle for cheaper cars or homes. It’s a common sense approach. Choose what’s most important and then work from there.

However, someone told me the other day that financial writers such as myself are really doing a disservice to most people by telling them that they have to choose. This person said that, by making people choose, we’re not encouraging them to do the work necessary to have it all. We’re telling them that it’s okay to “settle” for forty-thousand dollars a year. We’re telling people that it’s okay to settle for a limited lifestyle. This person said that what I should be doing is encouraging people to find ways to have it all.

According to this person, I’m supposed to be telling people to get out there and earn more money. Start their own business and make millions. Work three jobs. Send your spouse to work, even if that’s not really what you want to do. I’m supposed to be telling my readers how to make money, money, money so they never have to settle for anything less than everything.

I have to admit, I sat stunned listening to this person make their pitch. I don’t know this person well, but I felt like I was listening to some kind of late night infomercial. This person comes from an entrepreneurial background and does have enough money to do and have many things. I’m just not sure he’s in touch with reality.

Is it possible to start your own business and make millions? Sure. It’s also possible to make a lot of money by working more jobs, more hours, and sending an unwilling spouse to work. It’s also equally possible that you won’t make millions, you might lose everything, end up depressed, pissed off, and wondering what’s happened to your life. Am I supposed to tell people to take that risk? (While I do advocate additional jobs if you’re deeply in debt or having some other sort of financial crisis, I’m not sure it’s the best path under “normal” circumstances. There’s additional stress and the costs of additional childcare, among other things to be factored in.) Or, worse, am I supposed to tell them to never settle, even if that means accruing killer debt loads?

I don’t think financial writers who tell people to make careful, considered choices are doing a disservice to their readers. I think it would be worse for us to tell people to pursue only money at the expense of any sort of quality of life. It’s not a bad idea, though, to encourage people to better themselves. If you can learn new skills or get a better education that will lead to better opportunities then that’s wonderful. If you improve yourself and end up in a position where you can have it all, then that’s great. If, however, you don’t want to do that or you don’t want to take on so much work or responsibility, then you’ll need to make choices.

One way isn’t better than the other. If you genuinely want to earn more money, or if that money comes as a result of other improvements that you make, there’s nothing wrong with that. By all means, chase the dream of having it all. But that’s not for everyone. Either it’s not something they want to do, or they aren’t able to do it, for whatever reason. For those people (which I suspect are the majority), the answer is to make choices. Choose the things that are most important and let other things go. In fact, if you’re making these kinds of choices, you’ve already made one choice and that was to say, “Money isn’t everything and I’d rather have more time at home, keep a partner at home, or spare myself the insanity of chasing everything at once.”

(Photo courtesy of Solo, with others)