Financial Advice that Doesn't Pass the Sniff Test

In Part 1, we looked at a holiday reading wish list that can get you on the road to financial literacy. But for every The Wealth of Nations available to you, there are a hundred Art of the Deals.

This may seem like common sense, but not everything in books by well-known authors is accurate. You would be surprised how often we’re lured in by a slick-looking book cover and a clever title. Just because a book is a bestseller doesn’t make the financial advice contained therein any more valid. Let’s take a look at some general things to avoid on the bookshelf or in the digital library.

Avoid Those “Experts”

Not everything that Suze Orman says is wrong; neither is Jim Cramer incorrect about every single one of his stock picks. As they saying goes, even a busted clock is right twice per day. This isn’t just about picking on Suze or Jim; they aren’t the worst of the offenders by any stretch. But what they have in common with financial charlatans is their insistence on being labeled an “expert” on financial matters. True experts don’t even bother calling themselves experts. Their expertise becomes immediately evident to those in the know. You’re more likely to get good financial advice from someone who considers themselves a “practitioner.”

Related: 7 Warning Signs About Your Financial Advisor

I have a theory that important mail almost always arrives in a plain, white envelope, whereas junk always comes plastered with “Open me now or suffer a fate worse than death!!” in red 24-point font. Knowledgeable authors generally won’t waste much time wowing you with their credentials. Consider that there may often be an inverse relationship between the book jacket credentials and the quality of the advice inside.

Avoid This Entire Genre

Look, there’s no sugarcoating this: anyone making money hand over first flipping houses, buying penny stocks, “hedging the market” or using any other fancy-sounding strategy is not going to stop using that strategy long enough to write a book about it and then sell you that book. People making money want to continue to make money. What they most certainly DO NOT want to do is create competition for themselves by arming hundreds or thousands of other people with the exact information needed to successfully win in that marketplace. The author’s actual strategy is not to help you make money like he or she has; it’s to help them make money when you buy their book. This is true even if they’re giving the book away for free. Trust me, there are some costly seminars coming right up that will help you “truly step up your game.”

Dentists, while generally intelligent, can fall prey to these things just like anyone else. Don’t waste your valuable time. If you’re serious about flipping houses or (insert money-making strategy here), there are ways to go about it and people who have made money doing it. You’re incredibly unlikely to read their book and be able to translate that to personal wealth.

Avoid This Book

Entirely aside from the 2016 election and how you may feel about President-elect Donald Trump, The Art of the Deal is a dreadful financial book comprised of misinformation, clichés, and all-around terrible writing. It is a truly awful book. First of all, Trump didn’t even write the book; it was written by ghostwriter Tony Schwartz, who has himself called the book “truthful hyperbole.” I’m pretty sure even that is a stretch!