Poor advice (29 May 2004)
You want to buy a new watch. So you go to a shop. The shopkeeper estimates you have enough money to buy a 4500-euro Rolex.
But he also has a Casio watch that costs no more than 20 euros and is no less accurate than a Rolex.
Do you really believe he'll advise you to buy the Casio because it offers more value for money?
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When my wife and I were looking for a mortgage for our apartment, we went to a so-called advisor, named Financieel Advies Centrum van der Graaf.
He advised us a form of mortgage which may have been favorable for yuppies -- but definitely not for us.
He told us this form of mortgage was ideal for us, and we believed him. After all, he was our advisor.
Later we discovered that the main reason why he had given this advice must have been that this kind of mortgage gave him the highest provision.
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Since these self-proclaimed advisors often have no other aim than their own profit, we may wonder whether the government shouldn't make this kind of practice impossible.
After all, as long as different forms of mortgage give different amounts of provision to the agents, the temptation will remain to advise the mortgage with the highest provision. Under these circumstances their title of advisor is little more than a joke.
