Expert Financial Advice Won't Save You
You need to tweak financial advice based on the facts of your life
It’s never been easier to access quality financial advice.
But most people still struggle with the same financial problems they did 10-20 years ago.
Yes, there is a lot of garbage financial advice on the Internet—especially on Twitter and TikTok. There are also a lot of great, evidence-based discussions about how to manage money.
Undoubtedly, there is a filtering problem. When there’s THIS much content, how do you skim through the garbage to get to the good stuff?
Even if you find great finance writers who know what they’re talking about, you can’t simply follow their advice blindly. Personal finance needs to be, well, personal. No writer, no matter how knowledgeable or insightful, can give you all the answers—because they don’t know what your personal circumstances are.
When I publish an article, I know around 9,500 people will read it. There is no way I can write an article that will provide a blueprint for 9,500 individuals who live different lives, have different personalities, and have different goals.
Yes, you need to learn from expert financial advice—but then you need to personalize it.
In this post, I explore a research paper published in the Journal of Experimental Social Psychology that backs this up.
Let's unpack the findings and, most importantly, explore how you can leverage this knowledge to fine-tune your financial decision-making.
The TLDR version of the research
The study explored how different types of financial self-control strategies impact spending behavior. Researchers focused on three main approaches:
Expert Strategies: Those empirically tested and recommended by financial gurus.
Lay Strategies: Common wisdom-type strategies, suggested by everyday individuals.
Personal Strategies: Unique strategies that individuals devise based on their experiences and preferences.
Now, the real kicker of this study?
It found that individuals who used personal strategies spent significantly less than those who followed expert or lay advice.
Why personal strategies win
Tailored to You: Personal strategies naturally align with your lifestyle, habits, and goals.
Situationally Relevant: They are adaptable to specific spending contexts, making them more practical in real-life scenarios.
Emotional Resonance: Personal strategies often hold more emotional significance, leading to stronger commitment and follow-through.