With the rise of social media financial “gurus” and self-proclaimed experts, it’s easier than ever to get money advice. But not all advice is good advice. In fact, some financial recommendations can do more harm than good. Rienzie Biolena, a Registered Financial Planner, shared with Financial Adviser PH four major red flags to watch out for when receiving financial advice.
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The Advisor Doesn’t Listen to You First
A financial advisor’s first job isn’t to sell—it’s to listen. If someone is pushing a financial product without understanding your goals, needs, and budget, that’s a huge red flag.
“All financial advice must start from you: your dreams, hopes, aspirations, challenges, needs, wants, and resources. An advisor should take stock of these first before dispensing their recommendation; otherwise, it would just be a recommendation that is uninformed and, worse, detrimental to you,” Biolena explains.
Too often, people end up buying financial products that don’t align with their actual needs—simply because an advisor didn’t take the time to ask.
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It’s a Generic “One-Size-Fits-All” Statement
Financial planning is personal. If someone gives you a broad, cookie-cutter recommendation without factoring in your situation, proceed with caution.
“Motherhood statements are just good soundbites that, if applied to a person’s unique case, may not hold true. In some cases, they provide more harm than good,” Biolena warns.
For example, the debate between Buy Term, Invest the Difference vs. VUL shouldn’t be about which one is “better” in general—it should be about which one is better for you.
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The Math Doesn’t Add Up
Some advice sounds great in theory but falls apart when you run the numbers.
“Financial advice, like medical advice, should be as accurate as possible, giving the right instrument at the right amount,” Biolena explains.
If a financial recommendation seems too simplistic or vague, ask for calculations. If they can’t explain how they arrived at the numbers, think twice before following the advice.
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It’s Based Solely on the Advisor’s Personal Experience
Everyone’s financial journey is different. Just because something worked for one person doesn’t mean it will work for you.
“Each one has their own family dynamics, resources, constraints, path, and needs,” Biolena says.
A responsible financial planner doesn’t just share personal success stories—they analyze your situation, crunch the numbers, and tailor a plan that fits your goals.
The Bottom Line
Bad financial advice can set you back years. Before following any recommendation, make sure it’s backed by real numbers, aligns with your personal situation, and comes from someone who listens to you—not just sells to you.
