Cheap Information Is Dangerous

There is a downside to having easy access to information.  It is not as costly as the upside to having information available, but it is very difficult to overcome unless you know it is there.  It manifests itself commonly when semi-informed people deal with professionals.

There is a great deal of disorganized information on the internet.  That means that it cannot qualify as knowledge.  Knowledge is organized, it is categorized and you can tell what is missing.  It is possible to differentiate the important from the trivial.  Nothing like that on the net.

I pity doctors and other health professionals who must deal with anecdotes about how someone cured their cancer by meditating, drinking cold tea, and eating almonds.  If you ever study critical thinking, one of the first things they will tell you is “Anecdotes are not evidence”  It takes years to learn to be a doctor and years more to be an effective one.  Doctors who are 35 to 40 are your best bet because they are still current with the modern science and have enough experience to know how to apply their knowledge.  Some older doctors get out of date on the technology and some young ones have not yet learned the idea of patient counseling and motivation.

It is pretty much the same with other professions.  Do-it-yourself wills, tax plans, investment portfolios, surveys, structural engineering and internet based car and house insurance hold risks that a non-professional cannot easily see.  Dentists seem immune.  No one thinks they can do their own root canal.

The media frequently offers the idea that the cost to hire professionals would amount to a fine sum at a later date if you paid none of the fees and invested the money you saved.  I don’t know many wealthy journalists that have made their money this way.  It does make a good column though.

People must come to realize that tidbits of information having limited validity do not make the basis for a strategic vision and the tactic set that would implement it.  Wisdom demands that you act on real problems and opportunities with complete knowledge filtered to your peculiar circumstances.

Most people have difficulty establishing their problems and opportunities even though they are close to those.  Using shards of knowledge to create tactical methods is a vast swamp for the unprepared.  Knowing a little is worse than knowing nothing.  Knowing a little can cause you to focus on a fact, probably true, that has no relationship to your own situation.  Think of the data point you find to be the beginning of your investigation.

You are familiar with the idea a little learning is a dangerous thing.  The reason is clear.  People need complete knowledge, an ability to weigh it for a particular problem, and the experience to apply it to an equally complex and often subtle real world situation.  Only professionals hold those attributes.

Like all things in life, cheap is expensive.

Don Shaughnessy arranges life insurance for people who understand the value of a life insured estate. He can be reached at The Protectors Group, a large insurance, employee benefits, and investment agency in Peterborough, Ontario.  In previous careers, he has been a partner in a large international public accounting firm, CEO of a software start-up, a partner in an energy management system importer, and briefly in the restaurant business.

Please be in touch if I can help you.  don@moneyfyi.com  866-285-7772

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