Advice For the Masses is Not For You | Zach Miller
See the full episode notes HERE
In the most recent episode of AWM Insights, Brandon, Erik, and Justin explore who you should listen to when it comes to investing. Whether it is an internet message board or TikTok - who is actually qualified to deliver advice?
Is this advice for me?
Nope. As a professional athlete you should not be wasting your time following financial strategies marketed to the masses. Their message isn’t meant for you, and while they may not have ill intentions, you deserve better advice from someone that understands your situation and is loyal only to you.
Athletes have very unique circumstances that require knowledge most people, including many advisors, don’t have. Most of the time these people are on social media, radio, television, etc and trying to sell you something. I was naive as a player and wrongfully assumed that my advisors would always be putting my best interest first. Do not let mediocre financial advisors, business managers, or agents separate you from your money.
If you need ACL surgery, do you read WebMD and then do surgery on yourself?
You might think this is a silly comparison, but this is exactly what many people do when it comes to managing their investments. Many investors get their advice from the internet, friends, or teammates in the locker room.
“‘Hey buddy, you've had TJ [Tommy John surgery], you want to grab the scalpel and head on in tomorrow?’ No. And that sounds super ridiculous. But when you start to step back, that's exactly what you're doing. You're taking advice from somebody that has no idea what the hell they're talking about.” - Brandon Averill
Be careful taking investing tips from Reddit, Youtube, Tiktok, Instagram, or Twitter. These places are full of people offering investment advice that have no clue what they are talking about. They appeal to the emotions and biases of their followers and have no designations or experience to offer good advice. It can be very dangerous and end up costing you a lot of money if you end up listening.
When it comes to financial advisors as a profession, they have brought this reputation upon themselves by focusing on being salesmen over offering financial advice. It will not be like this in the future. A true advisor should spend the time to be involved and educate you throughout the process so that you grow your investment savvy. There are many great advisors besides us that offer incredibly valuable advice without pushing their products and evaluate your entire financial life, not just investments.
Be careful of where you take your investing tips from and always question their incentive.
Are they dedicated to their craft?
What has your advisor done to demonstrate they are qualified? Have they put in the effort and time to be able to help you?
“But let's turn back to the financial advisors. 300,000, right? Well they are 80,000 CFPs. That's still a big number. Do yourself the favor and at least find a CFP. If you don't have a CFP, it doesn't mean they're a bad person. Maybe they're even a good advisor, but you know what? They didn't do the work to go get the designation to show you that they're dedicated to their craft.” - Brandon Averill
A business manager is not a wealth advisor that puts the effort in to get the CFP®, CFA, or CPWA. I went through NFL retirement just six years ago and have already passed the CFP® exam. Do not settle for average advice because your advice should be elite as your athletic ability.
Utilize the SEC’s website to research any advisor that you work with. Find a CFP here. If you are an active or retired NFL Player, you have access to Financial Finesse, which only hires CFPs, for a second opinion on your financial plan. Utilize the resources and do your due diligence so you find the right advice.
No Magic Pill
Just as in your diet, health, and fitness, there is no magic pill for your wealth. The core fundamentals of wealth creation and stewardship are having a long-term time horizon, keeping costs low, removing your emotion, staying diversified, and having an after-tax return awareness. Remember that If someone is promising you something that seems too good to be true, it probably is. There is no free lunch in investing.
“There are building blocks of how you pursue wealth and what it's not - it's not making somebody else rich. There's this famous book that says, ‘Where are all the customers' yachts?’"- Erik Averill
A good question to ask yourself, is your advisor giving objective and independent advice or are they playing to your emotions.
“First and foremost, we would say this is true for every single individual, whether you have 10 bucks or 10 million bucks, is that you deserve to work with an advisor who is aligned with you on the same side of the table.” -Erik Averill
I couldn’t agree more that all individuals deserve unbiased, independent financial advice from someone held to a fiduciary standard.
