Nick writes….
Why Personal Finance is a Bit Too…Personal
Though you have probably never heard of Wally Jay, he is considered one of the greatest judo instructors of all time. Despite never once competing in judo (only in jiujitsu), Jay consistently produced champions in judo and other martial arts. One of Jay’s key insights was that not everyone learned like he did:
The biggest mistake is for an instructor to teach exactly the way he was taught. Once a teacher said to me, “All of my boys fight like me.” Then when we got on the mat, not one of his students could beat one of mine. Not one. So I told him that he had to individualize his instruction.
This lesson seems to be lost on many financial commentators/bloggers who provide personal finance advice based on their own experiences, which are typically outside the norm. The exceptions become the rule and then personal finance becomes a bit too…personal. I am reminded of the words of Richard Hamming:
Please remember that what made you great is not appropriate for the next generation.
One prime example of this comes from one of the finance bloggers that got me into this scene, The Financial Samurai (aka Sam). Sam has done a lot of great work, but there are times when he applies his personal experience far too stringently when giving advice to others. The best example of this is his post titled “The First Million Might Be the Easiest: How to Become a Millionaire by Age 30”.
In this post Sam breaks down his journey to $1 million by age 28. If you don’t have time to read the whole thing, the summary comes down to: have one incredible lucky trade in the Dot Com bubble (make 50x), earn a boat load of money in finance, and live a relatively frugal lifestyle. And for his age, Sam was making a “boat load” of money.
Read More
https://ofdollarsanddata.com/the-problem-with-most-financial-advice/