Why ‘I Don’t Know’ Is Often Your Best Money Answer

As investment managers or financial planners we are often expected to predict the future.  Although my crystal ball broke a long time ago, predicting the future is a part of the investment management business that I never got into.  It makes sense because even the best laid plans can go to the waste side at any moment.  This is one reason why it is so critical to review your investment or financial plan at least once per year.  You never know when a catastrophe may strike or when you may win the lottery.

At DWCM we try to educate people about investment management and financial planning.  Part of that education involves explaining to people that we may not have all of the answers.  We can only assume the outcome using various financial analysis techniques.  We often plan for conservative outcomes and hedge our positions where we can.

Someone that tells you that they have all of the answers....run as fast as you can in the opposite direction.  There is no doubt that you should turn to an expert for assistance in a time of need.  However, there is no way to get around the fact that know one knows what the future will be, how markets will perform, or what the economy will be like 10 years from now.

Remember, investment management is a continuous learning process.

In this NYT piece, fellow financial planner Carl Richard explains why ‘I Don’t Know’ is often your best money answer.

• Accepting the fact that we just don’t know allows us to let go of any anxiety around the idea that we should be able to find someone who does know. And let me share a secret with you about that: There isn’t anyone who knows what the next week, month, year or even decade will look like in the stock market. Anyone who says they do is someone you should run from.