lazygood4nothinbum said:
a very good friend of mine never takes my financial advice.
Don't feel bad. Nobody takes my financial advice either; maybe because I don't look very smart. This is helpful to me when I am negotiating, as my contra party often assumes that I am an idiot, until he checks his pockets.
But it is annoying when I would like to be helpful, as people just can’t seem to take me seriously.
I know a woman who inherited $2mm in 1998. She had an 8 year old child. In 1999 she got divorced. I met her in 2000, and after talking a bit I figured out that she was out of her depth, had no job, no health insurance and no plan.
In general, I won't give advice that involves coming down on one side or another of a specific investment, as there is too much room for resentment if I am wrong. Which can easily happen. But here was an easy one. I suggested that she first get health insurance. Second, refinance her mortgage. Third, consider going back to court to get more child support. Fourth, decide if she wants to work, or try retirement. (She was in her late 40s).
So what has she done? Nothing, except make ineffectual, badly informed and money wasting attempts to start 2 businesses, spend way more than she should on living expenses, and lose a fair amount of money in terrible investments sold to her by some woman salesperson she met at a "business owners" meeting.
A lot of her spending is on hair, skin, clothes, etc.-which I feel might be intelligent if she went hunting for a man in the right places. University Club meetings? Sailing lessons? No way, she prefers karaoke bars.
She also sent her kid to an expensive private school, even though she lives in a really good school district.
What has she not done? Buy health insurance, refinance her mortgage or try to get more child support.
The only thing I learned is that there is no accounting for the way people put things together.
I’ve had no better luck with my son, even though he knows my financial position, and also knows I have recommended over a 7 year period 4 or 5 absolute lock investments. For example TIPS at +3.5; SU at 18 ½; UST at 16-18. Meanwhile, he pays a pretty good sized wrap fee for some idiot who couldn’t make enough money investing to retire even if he had a $1mm head start.
It’s an education in human nature, if nothing else.
Ha