Don’t get lured by Financial Pornography

As the old saying goes, "Sex Sells". Just look around at the advertising world and you can't help but see the barrage of sexual images to sell products and services that really, have nothing to do with sex.

In the financial world, there are not a lot of pictures of half naked men or women selling mutual funds or other investment products but there are other forms of what I call financial pornography.

Financial pornography is really whatever it takes to sell investment, financial and retirement products. It's about using numbers, words and images in a sensational manner to arouse an emotional reaction. Here are three forms of financial pornography.

Performance based advertising

One example of Investment pornography is the use of performance-based advertising. Look in the paper today and you will see performance based advertising showing an investment that made excellent returns. Today most of them have something to do with Real Estate.

Financial institutions prey on investors by using past numbers to lure you into their products. Here's the problem: everything goes in cycles. What goes up comes down. What goes down comes up. What goes down the most comes up the most and vice versa. We get lured in because we can't help but think in straight lines. We think that what has gone up in the past will continue to go up in the future. If it were really that easy, then why do we all lose money from time to time? It's because we forget the one disclaimer that the investment industry preaches; Past performance is no indication of future performance.

Get rich quick

We live in a now society. It's all about immediate returns and immediate benefits. The faster the better. Think about some of the common advertising slogans out there: Just add water, microwave in 2 minutes, lose weight in 7 days, 30 minutes or it's free and in the financial industry, get rich quick! Hey, wouldn't we all want to get rich quick? Sure, it happens to some but hey represent the extreme minority. In most cases wealth is created by hard work, good planning, and innovative thinking. You can get rich with luck but the odds are against you. Just remember the old saying, if it's too good to be true, it probably is.

The retirement dream

What do you plan to do when you retire? Do you see yourself traveling? Maybe lying on a beach, reading a book, drinking a cold beverage? Most people, when they think of retirement have images of what I call retirement stereotypes. In other words, the images that companies have used to paint what retirement should look like have stuck in our own head as the vision of what retirement should be.

The bottom line is retirement is personal. In other words, retirement can be whatever you want it to be. In reality most people don't travel 365 days of the year. In fact, they don't travel 180 days of the year, or even 30 days of the year in retirement. People who do travel often say "It's nice to be home" at the end of their trip.

Successful retirement is more about understanding what you do at 'home'. There are lots of people living incredibly successful, purposeful and meaningful retirements doing really ordinary things. You don't need to have what society says retirement should be to live the best years of your life. Do what makes you happy.

Today we are pounded with more advertising and stimulus than the human brain can possibly handle. Everyone out there is doing whatever they can to get your attention. To help you combat financial pornography, I offer you two very simple tips: Ignore it and don't buy it if you don't understand it.