The Flinchum File
Thoughtful Economic Analysis and Existential Opinions

The Conceit of Choice


Carl Richards is a long-time financial planner and my favorite columnist for The New York Times.  (Truth-in-blogging:  I took his course on behavioral finance a few years ago and have been a fan ever since.)  In his latest book, he shares an interesting personal story, which I quote:

Take my recent experience with my dog, Zeke.  He was having some stomach problems (I’ll spare your the details of how I knew.), and it was clear we needed to take him to the vet to get him checked out.  I’m probably a lot like you:  busy.  When Zeke got sick, my family was getting ready to leave on vacation, work was piling up, and the kids needed to be shipped back and forth between a bunch of activities.

But luckily the vet is located literally two hundred yards from my office.  When I dropped him off, I told the vet I had a ton of errands to run.  ‘Why don’t I come back in a few hours once you’ve had plenty of time to fully check him out?’

When I returned, the vet informed me that they had time to do a full diagnosis and they’d run all kinds of tests.

Then she said, ‘You have three options.’

That was when everything fell apart.

As soon as she said ‘three options,’ I felt myself start to panic.  In fact, I felt like my heart was about to explode.

As I tried to collect myself, she started to walk me through option one.  About halfway through her description of the treatment, I couldn’t take it anymore.  I held my hands up in the air, looked her in the eyes, and said ‘Stop, Just tell me:  If Zeke were your dog, what would you do?’

She went back to walking me through the options.  I stopped her again.  She did it again:  more options.

Finally I put my finger to my lips and I actually shushed her.  Then I said, very slowly, ‘No.  Really.  I mean it.  Stop giving me options I’m not qualified to evaluate.  Please, I’m begging you . . . just tell me what to do.’

His story reminded me of a quandary my wife and I found ourselves in a few years ago.  She needed health insurance, so we went to a recommended health insurance broker.  There was one insurance company to insure her health, but they were likely to be acquired soon, which would change whatever coverage we wanted.  There was another company, but they had a bad reputation for customer service.  There was another company that didn’t offer the coverage she wanted.  And, so on . . .

Then, we had to determine what coverage she needed.  Since neither of us are medical doctors, we took a reasonable guess.  Then, we had to determine what coverage she might need in the future.  Again, we took a wild-probably-unreasonable guess.

Oh, yeah — there were all the costs to compare — by that point, I was being forced to make a choice that I was not qualified to make and badly wanted to repeat what Carl Richards said:  Please, I’m begging you . . . just tell me what to do.

Sometimes, I wonder if financial advisors are as guilty of suffocating clients with choices as vets, brokers, lawyers and doctors.  The head of the CFP Board of Standards was discussing the millions of Americans who are unprepared for retirement and said “The truth is more a third of those surveyed are overwhelmed by the process.”  Whose fault is that?  While the regulators deserve a heaping portion of the blame, financial planners also deserve some.

Although certified to do so, I haven’t written a formal financial plan in years.  I found some of those painstakingly written plans that I did were sitting in bookcases or file cabinets, dutifully filed away.  Too important to trash, too confusing to act on.  My experience suggests that a real financial plan has to be a “way-of-living.”  A financial planner should be “part of your outer-family.”  Don’t invite him/her for Christmas holidays, but do think of him/her as an older relative that you can trust.  Pick up the phone!

A financial planner should not force his clients to say:  Please, I’m begging you . . . just tell me what to do.

But, if the clients do say that to you, then show mercy on them.

Yes, too little choice is bad . . . but too much choice can be worse!



Richard’s quote is from The One-Page Financial Plan, 2015, Penguin Group, NY, NY.  It is dedicated “To the Secret Society of Real Financial Advisors:  Thank you for the difference you’re making in the world.”

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