What’s with all the hyper active reporting on the financial networks? What’s everyone shouting about? And why does it seem that it’s either something incredible or incredulous?
CNBC, Bloomberg and the like deliver the news without a break. In some cases, 24 hours of coverage with number scrolling color coded data. Jim Cramer and company have their opinions and prognostications. Suze Orman knows how you should be dealing with your money. Dave Ramsey has his ideas as well.
Here’s the problem. None of these people are talking to you. That is not to say that the information doesn’t have value, but they don’t know who the people are in their audience. And, unfortunately, their job is not to put you in a better financial situation. Their only job is to get you to listen. Now hopefully what the audience is listening to is financial truisms and useful (albeit generalized) market philosophy. But often, that is not the case. Quite often the financial ‘guru’s give advice to the audience or directly to callers without having any sense of who the person is, how that person feels about money or what emotions are behind the financial decisions they make.
Periodicals, newspapers, TV, radio, etc., all provide a tornado of information about what has happened, and what might happen to the markets and the economy. The information is peppered with opinions about what effects the subject du jour will have on the American public. But to whom does the information most aptly apply? You? The person who is also listening in the car next to you? Frankly, probably neither.
I encourage people to explore information regarding finances in as many outlets as you have time or interest. But instead of absorbing it all as scientific fact, absorb it as you would if you were reading a novel. Absorb the content and pull out key learnings.......but not must do action items.
More importantly, the key to financial education is to understand your own financial situation. Understand the facts and figures of your own personal financial market. Only you know key economic indicators of your life. Do you like your job or are you hoping to retire young? Only you know if your children are developing a financial acumen and how it will or won’t affect your long term goals (or for that matter the effects of your parents, siblings, etc.). How’s your health? How’s your job security and future prospects for the industry you are in? These are way more critical variables to how you should approach finances than TV talking points like how the Dow’s 200 day moving average and 50 day moving average recently created a ‘death cross’. And it’s certainly not important if you have no idea what that means (although I’m sure you now want to look it up…Here you go!).
None of the financial talking heads know you, and the value of their advice can only affect your financial path so much before their proselytizing loses its value. Listen to the white noise, but accept it simply as white noise. Then educate yourself inside and out about your own particular financial outlook and trust yourself to do what’s best for you.