Who doesn't want to hear that they look great in those jeans, belt out a tune like a pro, and are looking A-OK to achieve their financial goals? We're probably better off believing that no one notices those few extra pounds and that we nailed every note on karaoke night.
In matters of money, on the other hand, no one's doing you any favors by fudging the truth about your financial situation. Little white lies lead to stupid money mistakes -- costly blunders because we were misinformed, misled, or simply didn't have the proper context:
- Would you buy a new car if you knew it would push your retirement date out five years?
- I bet you'd think twice about borrowing from your 401(k) if someone spelled out what doing so was really going to cost you in the long-run.
- If you hadn't been told by the real estate professionals that, sure, you could afford the bigger house, would you have stretched your budget to the brink to buy up?
So why are the people we pay for a professional reality check too scared to tell us the truth? Short answer: Financial advisors are afraid we can't take it and will take our business to someone who tells us what we want to hear, not what we really need to hear.
Can you really handle the truth? Oh really?
Brutal honesty can be bad for business. What paid professional money advisor wants to tell a potential client that their finances are a disaster and their dreams are way out of whack with reality ? On the flip side, what client wants to hear how boneheaded they're being with their money?
You should. The truth might sting for a bit, but we'd all be much better off if our financial pros didn't p----foot around our problems because they're scared we can't take it.
That's what makes Sheryl Garrett so special. In her more than 20 years in the financial planning field, Garrett has seen the fallout from clients who were misled by previous advisors or simply ignored the advice they had been given. Garrett, founder of the Garrett Financial Network , tells tales of wealthy families who never bothered to compose their wills, near-retirees with nothing in their nest eggs, and families drowning in homes that were four times more than they could afford.
She's not afraid to dish out the tough love. So get ready for a financial reality check, readers! Here are excerpts from an interview The Motley Fool conducted with Garrett:
4 Things Everyone's Too Scared To Tell You
1. He's gone and you're back to square one
"From a purely personal finance standpoint, surviving the loss of a spouse -- whether through death or divorce -- is literally like starting out all over again financially.
"One common mistake I see is that women want to keep the house -- we feel like we weren't able to hang on to our family as we knew it, and so we hang on to our home life because it looks the same. That can be a really disastrous mistake. Sometimes we need to cut the cord and really step back and make some severe adjustments in our lifestyles to survive."
2. It's either your kids' dreams or yours. Sorry kiddos
"The majority of baby boomers don't have their own financial situation in good enough shape to be paying for kids' college. Yet so many parents pledge to their children, "Hey, if you make the grades and get in, mom and I will take care of paying for college.' And there is nothing like breaking a promise to your child to break your heart. But, for the sake of the rest of your financial household, you need to make sure to take care of yourself first.
"There is no such thing as financial aid in retirement. I encourage parents to strongly consider having Junior take out loans (and if you need to take out loans ... to cover the tuition, that's fine, too). And there is nothing at all wrong with junior college or a state university. In most professions, what matters is having a degree -- not where it's from."
(Don't feel guilty about putting your needs first. "Should You Save for College or Retirement?" points out how everyone's better off if you take care of No. 1 first.)
3. You are going to die. Deal with it
"Getting a will done is probably one of the easiest things to procrastinate on because we would like to think we won't need it for a long, long, long time. Plus the concept of estate planning feels negative.
"Well, quit being ignorant. You are not invincible. When death occurs, it is a very, very traumatic thing on the surviving family. Don't make it worse by not taking care of your financial affairs ahead of time.
"Estate planning is a gift that you give to your loved ones. So give your spouse and family members the gift of taking care of things like life insurance, wills, beneficiary information in advance. Take the financial and emotional burden off your family and your survivors. If you don't, you are going to put them through living hell at some point in the future."
(Are you prepared to die (paperwork-prepared, that is)? See "How Not to Be a Burden to Your Family" to give your loved ones the gift of peace of mind.)
4. You aren't getting younger, so you better get smarter
"In one of our questionnaires we ask, 'What in your financial life do you wish you would have done differently?' No matter if the person answering is 27 years old or 77 years old, they almost always say something like, 'I wish I would have started sooner.'
"You have to recognize that nobody is going to take better care of your money than you will. Getting started is hard -- a lot of times people don't know where to begin. But you cannot put this off any longer. Start taking the initiative to become an informed consumer, an informed investor, an informed individual with regard to your money because if you are working with a financial advisor, you need to know what they are talking about. You need to be able to ask them questions and understand their responses. If you don't understand them, you need to feel comfortable enough to say, 'I don't have a clue what you said.'"
(You can't turn back the hands of time, so put down the wrinkle cream and start calculating how far your savings will take you in retirement. See How to Salvage Your Retirement Plan Right Now ." If you decide to seek the help of a money pro, this free advisor questionnaire will help you find out if they're a good fit.)
Ready to face reality?
Questions about saving for college? Asset allocation? Annuities? Insurance? Credit? We'll tell it to you straight and walk you through these topics and more in our Personal Finance and Retirement areas on Fool.com.
And - plug alert! -- if you want to get a second opinion from a trusted, independent, fee-only financial advisor (the only kind of advisor we recommend), see if there's a Garrett-certified pro in your area . (For a limited time Motley Fools can get a complimentary "Get Acquainted" meeting (over the phone or in person) and a 10% discount for new clients. Find an advisor in your area and look for The Motley Fool icon.)
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Dayana Yochim sent her parents to Garrett Financial Network nearly a decade ago to get their important papers in order. No, they didn't write her out of the will for making the suggestion. They thanked her.