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Clueless friends giving you money advice? Use the STFUDF Technique

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How many people in your life lecture you about finances, but don’t have their own finances under control?

Nothing is more infuriating than someone telling me I’m “throwing away money on rent” when they haven’t spend even 2 hours running the numbers.

Or someone who proudly proclaims that they found a higher interest rate on a new bank, which is giving them 2%!!! When you politely say, Wow! How much is that worth? they get very very quiet…because (1) they never thought about it, and (2) you know that an extra 1% is only worth $8/month for a $10,000 balance.

Or people who bragged about their hot tech stock being up 80%…but then don’t mention it 2 years later when they realize it crashed and they are actually not very good at picking individual investments. I’m guessing that on their idiotic penny-stock-picking website, they probably didn’t learn the two most important words for choosing investments: asset allocation.

Introducing the STFUDF Technique

So it’s with great pleasure that I introduce the STFUDF Technique. DF stands for Dumb Friends.

One of my newsletter subscribers, Chris Sundberg, inspired this when he told me how he uses tax refunds strategically.

“I get the lecture from just about everyone I know. However, I purposely have my employer take an additional amount out of my paycheck so that I get a bigger refund each year. I know the government gets to use it interest free for a year, but…. I also get a little “bonus” every year to spend on whatever I want. I’ve automated the rest of my finances so I don’t miss the money a bit. And if the government gets to use it for a year…. we’ll call that patriotism. My paycheck gets split between my “bill paying” checking account and my “spend on whatever the fuck you want” account. That way I don’t have to budget. My bills all get paid automatically out of my bill paying account (including automatic contributions to my Roth IRA), and about $50 per month goes into an Orange Savings.

So…. whenever I get the lecture, I ask the person how much they’ve contributed to their Roth that year and when they can’t answer me honestly I tell them to STFU.

* * *

3 important rules for the STFUDF principle

  1. First of all, when people give you advice on finances, let’s be honest: They’re probably right. That’s because most people are horrible at finances, so just statistically, you probably are, too. You’re not allowed to use this technique until your finances are reasonably automated and optimized.
  2. HOWEVER — since you read this site and have presumably automated your money using my book, chances are you know more than this person. In this case, it’s permissible to implement the STFUDF Technique.
  3. Do not simply shout out “STFUDF STFUDF STFUDF” repeatedly. That would be uncouth. Instead, use subtle questions like this:
    – “That is really interesting advice. So should I think about this first, or my asset allocation?”
    – “Really? Woah…I never thought of that. What do you think should come first? [Their advice] or maxing out my Roth IRA? (Wait while they make something up, then say this): How come?”
    – “Nice! So how do you do this AND hit your 401(k) employer match AND your Roth IRA AND stay debt-free? I just don’t think I could do it.” This one is particularly clever as you’re employing a self-admission of inadequacy, which will make your friend writhe in pain since it’s impossible to counter.

Use the STFUDF Technique with care. It is powerful.

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  1. Good article – although curious about automating finances. Currently my work (tutoring for a uni) is somewhat temperamental (i.e. don’t get paid during holidays, get extra pay when I do marking or supervise exams, etc. Generally I’m not exactly sure how much is coming in until it does come in). So if there a way for me to automate finances at all? My current method is when I get paid, I manually send my money to a variety of saving accounts, and leave myself enough to get through the next two weeks. During periods where I don’t get paid, I pay myself out of one of my saving accounts (designated for that purpose).

    Any suggestions?

  2. Not quite the UK – Australia. Out of curiosity how localised is the UK version? The main problem I had with things like the Scrooge Strategy is that some of the help sheets were just too USA centric (most of the time I knew the Australian equivalent, but it did feel like I was losing value admittedly).

  3. I could have sworn the dumb friends was going to be dumb f…… nevermind.

  4. I find that during conversation, most people will say almost any dumb thing in order to sound smarter or wiser than they are. In my previous job, any time I told somebody “I’m looking for a new job”, people would just ramble off “Well, you should be happy to have any kind of job in this economy.” Really, how is that helpful? Does it actually add anything to the conversation? Does it provide any useful career advice? Do they think that was something I’m not aware of?

    I notice it when talking finances. People still ramble off dumb advice like that to sound like they’re telling you something.

    Ever since I figured that out, I’ve been watching myself to make sure I don’t ramble off dumb things in conversations just to fill air time.

  5. @Eric Exactly. Most people will give advice on any matter because they want to outsmart us. It’s really annoying and I’ve learned that the only way is to stay calm and not get pulled into such a stupid discussion.

    On the other hand some friends actually do want to help, but more often than not they don’t know anything about the matter, which ends up in stupid advice.

    What I do know is take advice only from the people with knowledge and experience in the topic I’m interested in.

  6. I also find that friends that have their finances in order tend not to be the unsolicited loud-mouth advice givers. I think it’s due to actually going through the process and realizing that you have to be personally motivated.

    I knew the process to pay off my credit cards and could tell you the pros and cons of it. It took me a couple years after to actually implement the process into my financial life.

  7. The best part of the whole post…

    “They’re probably right. That’s because most people are horrible at finances, so just statistically, you probably are, too.”

    Well said.

    I think we need to keep that in mind for most areas of our lives not just finances. But the bigger point is also valid, don’t listen to people who have no idea what they’re saying.

    Most people just want to sound intelligent by repeating what they’ve heard intelligent people say. I know I do.

  8. my favourite advice comes from friends who love to extol the ‘investment gains’ of day trading.

  9. “On the other hand some friends actually do want to help, but more often than not they don’t know anything about the matter, which ends up in stupid advice.”

    I like to think they are trying to be helpful most of the time…which leads to number 3 being the best strategy for me.

    What I hate the most is someone who really has it together giving advice to someone who only realized they need to get their finances in order yesterday. Don’t start talking about a Roth IRA with someone who only figured out they need to create a budget. Then you’re just being a show-off, not really trying to help the person who needs it…

  10. lol the very first line was funny enough. So many people lecture you about something they don’t know anything about. Sometimes it’s like they say “Those who know, do. Those who don’t, teach”.