How To Use Experts

In the talk below, economist Noreena Hertz reviews the issues with relying on experts.

Obvious things, such as the fact that experts aren’t always right. Doctors misdiagnose, and financial experts, by in large, didn’t see the “great recession” coming.

Perhaps this isn’t news. However, what was surprising, was what happens when we listen to experts.

She referenced an MRI test that was conducted on patients who were told they were listening to experts. Whether the information was right or wrong, the decision making part of their brains flat lined.

As in, shut down!

The dangerous implication here is that when you view someone as an expert, you are much less likely to dissent. To ask questions. To confirm that you understand the advice, but also that it is appropriate for you.

When it comes to personal finance, investments, and your future, having the knowledge of a CFP®, or a CFA, frankly isn’t enough. These certifications go a long way in shaping the advice we give to you, and the investments we use in a strategy, but that doesn’t help us tailor the advice to you.

When adjusting a strategy, or altering a financial plan, there are often multiple options. Understanding which option you are most comfortable with, and will ultimately live out, can mean the difference in whether or not a change is successful.

We like to think of working with clients as a partnership. Sure, one decision might be better than the next, but only in the context of your goals and objectives. Take 20 minutes to watch this talk to see if you recognize yourself in the descriptions.

** Moreena gave this talk at a “TED” conference in London in October 2010. “TED” began as a conference to bring together people from the worlds of Technology, Entertainment, and Design. Beyond the two main conferences, TED features similar events around the world, where the world’s most fascinating thinkers and doers, who are challenged to give the talk of their lives (in 18 minutes or less). **