Most people think financial mistakes stem from making the wrong decision. In reality, many of the most expensive mistakes happen long before that. They happen because we make important financial decisions in isolation.
One idea I explore in Your Next Million is that outside insight can help bring additional context to decisions that have been delayed. But after working with successful executives, physicians, business owners, dentists, and retirees for more than two decades, I've come to believe there's another side to that equation. Making financial decisions alone can create two very different, and potentially costly, problems.
One group waits too long.
The other moves too fast.
Ironically, both are usually driven by the same thing: trying to figure everything out alone.
Maybe you've heard stories like these:
None of these are dramatic mistakes. They're simply decisions that never get made. Behavioral economists often describe this inaction as decision paralysis. When a decision feels complex or uncertain, maintaining the status quo may feel safer than choosing a new direction. The problem is that doing nothing is still a decision.
Sometimes the greatest financial cost isn't making a bad decision. It's paying the opportunity cost of making no decision at all.
Not everyone struggles with indecision. Some people make financial decisions almost instantly.
These decisions often feel exciting because they happen before anyone has a chance to ask uncomfortable questions. How will this affect your taxes? What happens if you need liquidity? Does this create concentration risk? Will this delay your retirement? How does this fit with everything else you own?
One chapter in my book is titled When "No" Is the Best Advice because some of the most valuable planning conversations we've had weren't about finding better investments. They were about helping clients avoid decisions that didn't fit their broader plans. Sometimes the most valuable planning outcome is avoiding an investment or purchase that doesn't fit your broader financial plan.
I've often wondered why highly successful people—those who seek professional guidance in medicine, law, engineering, or business—sometimes insist on making major financial decisions alone. I've noticed a few common reasons.
Sometimes it's trust. They've been disappointed by advisors in the past and don't want another sales pitch.
Sometimes it's perfectionism. They believe they need to understand every detail before acting.
Sometimes it's independence. They've built successful careers by solving difficult problems themselves and assume this should be no different.
And sometimes, if we're honest, they don't want anyone to interrupt the excitement of a new opportunity.
They worry that objective advice might spoil the fun.
The irony is that a good financial planner isn't there to make your decisions.
They are there to offer context.
Financial planning is not about handing your life over to someone else. It's about creating enough distance to see what you can't see on your own. We all have blind spots. We're emotional about our own money. We're influenced by recent headlines, our experiences, our optimism, our fears, and our desire to be right.
An outside perspective provides something that's difficult to create on your own: objective friction. Sometimes that friction gives you the confidence to move forward. Sometimes it gives you permission to slow down. Either way, both can create value.
That perspective becomes especially important when a decision touches several parts of your financial life. Exercising stock options may affect taxes, cash flow, investment concentration, and charitable plans. Purchasing a second home may influence liquidity, retirement spending, insurance, and estate planning. No single area can fully evaluate that decision.
When people compare the cost of hiring a financial planner, they usually compare it to doing it themselves. One of the things I like to suggest as someone is evaluating whether to engage a financial planner is to consider the services offered, associated fees, and whether professional assistance would be useful in their unique circumstance.
Those costs rarely appear together on a statement. But over time, their cumulative effect may exceed what someone expected to save by handling every decision alone.
Good financial planning isn't simply about finding better investments. It's about evaluating alternatives, trade-offs, timing risks, and other financial priorities. Sometimes that means helping you act. Sometimes it means helping you wait. Either way, outside insight may reduce the cost of making financial decisions in isolation.
A significant financial decision rarely affects only one part of your life. Before moving forward, or continuing to wait, it can help to understand how the decision could affect your cash flow, taxes, investments, retirement plans, estate strategy, and other priorities.
At Spaugh Dameron Tenny, we help clients evaluate financial decisions in the context of their full financial picture. If you are weighing an opportunity, purchase, transition, or other important decision, we invite you to start a conversation with one of our financial planners.
Financial decisions often involve uncertainty, competing priorities, and consequences that extend beyond the immediate choice. Personal experiences, emotions, and assumptions can also influence how someone evaluates the available options. An outside perspective can help identify considerations that may be difficult to recognize on one's own.
A financial planner can help clarify the decision, compare possible outcomes, identify trade-offs, and evaluate how each option may affect other parts of your financial life. The planner's role isn't necessarily to make the decision for you, but to help you make it with more context.
Examples include exercising stock options, purchasing real estate, investing in a private business, retiring, selling a company or practice, making a significant gift, changing insurance coverage, or revising an estate plan. The appropriate analysis depends on the person's full financial circumstances.
Helpful topics may include the purpose of the decision, potential risks, tax considerations, liquidity needs, timing, alternative options, and the impact on other financial goals. A planner may also identify when input from an accountant, attorney, insurance professional, or other specialist would be helpful.
This article is provided for educational and informational purposes only and should not be construed as investment, legal, tax, or accounting advice. The information presented is general in nature and may not be appropriate for all individuals.
Any discussion of taxes is for general information purposes only, does not purport to be complete or cover every situation, and should not be construed as legal, tax, or accounting advice. Clients should confer with their qualified legal, tax, and accounting advisors as appropriate.
CRN202909-12003183
Shane Tenny, CFP®, is Managing Partner of Spaugh Dameron Tenny, where he helps high-net-worth individuals and families navigate complex financial decisions with clarity, structure, and confidence. Since joining the firm in 2000, Shane has worked with clients through major financial transitions, including career changes, liquidity events, retirement, and multigenerational planning. His approach combines comprehensive financial planning with a focus on behavioral finance, including advanced studies in Behavioral Economics through the University of Chicago Booth School of Business. Shane is the author of Your Next Million, former host of the Prosperous Doc® Podcast, and a nationally recognized financial advisor, speaker, and educator.
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