Why Doctors Smoke and Why You’ll Follow Financial Advice From Someone Else

Et æble om dagen...

Wrong in so many ways…

“My doctor tells me I should start slowing it down – but there are more old drunks than there are old doctors so let’s all have another round.”
–Willie Nelson

“If two heads are better than one, then what about double chins?”
–Jarod Kintz

Have you ever walked into a doctor’s office or a hospital and noticed a cluster of people standing in scrubs and overcoats clouded in a shroud of cigarette smoke?

Yet, how many doctors would recommend to their patients that they smoke tobacco?

When I was at West Point, one of the leadership credos that they hammered into my head was “do as I do rather than do as I say.”

In other words, if we wanted our soldiers to do something, then we had to demonstrate that we were just as capable of doing what we were asking them to do as they were. Naturally, this wasn’t always possible. Jobs are specialized, and the higher up you go in an organization, the less you’re going to be able to perform each job that your subordinates perform. Still, though, you had to lead by example and provide demonstrable leadership so that others would do as you asked. You couldn’t ask your soldiers to run 5 miles if you could only run 3, or, more darkly, you couldn’t ask your soldiers to go onto a battlefield and step into harm’s way if you hung out in the rear quivering with fear.

However, in many service industries – the medical is just one…I can think of financial planners who have had their houses foreclosed on or are neck deep in credit card debt, for example – we take advice from people who can’t really say that they’re modeling the behavior that they are asking their clients to exhibit.

Why is that? And why should we follow their advice rather than go with what we think is the best?

That was a question that Northwestern University’s Dr. Laura Kray and the University of Michigan’s Dr. Richard Gonzalez looked to answer with research they conducted regarding how people both made decisions and gave advice about future sticky situations.

Advice May Be Worth More Than You Pay for It


Continues Below








Think about where you want to go for your next vacation. If you haven’t already decided, what are the factors that you’re going to take into account? Maybe:

  • Cost
  • Hassle of travel
  • Things to do when you’re there
  • Kid-friendliness
  • Food
  • Tourism infrastructure
  • Language
  • Cultural importance
  • Activities

You get the point. There are probably at least a dozen attributes you can come up with, and then, when you really think about where you want to go, how do you determine what attribute is most important to you?

In most cases, you don’t. Instead, you come up with a simple mental model that allows you to conserve brainpower while considering your choices: weight each equally.

But, now pretend that your best friend has asked you to recommend where she should go on vacation.

How do you approach that question? You probably already know that your friend likes outdoor activities, is a foodie, wants kid-friendly places to go, etc.

So, you pick the place that has the highest likelihood of delivering on the one factor that is most positive. Then, you might provide a second option with a caveat like “if you’re on a budget…”

The research that Drs. Kray and Gonzalez conducted affirmed this approach in how we think about decisions versus advice.

They asked students to either choose a job or recommend a job to a close friend or an acquaintance. The two jobs were either well-paying but not particularly satisfying or personally satisfying and fulfilling but were never going to make the employee rich.

Students, when giving advice, recommended the fulfilling job much more than the high-paying job, whereas, when picking a job for themselves, the percentage of recommendations for the high-paying job increased significantly.

When asked about their weighting, the students who were providing advice discounted the other factors aside from personal satisfaction, but the students who were choosing for themselves had much more uniform (equal) weightings for satisfaction and for salary.

The authors pose one hypothesis for why we offer different advice than the actions we’d take for ourselves, and I have my own hypothesis.

The authors’ hypothesis involves the difficulty of implementing a plan. It’s easier to tell someone to do something that is perceived as difficult (stop smoking, go to the gym, eat a high fat, high protein diet and cut down on carbs) than it is to do it for yourself. Essentially, when you’re offering advice, you’re armchair quarterbacking, which is much easier than getting on the field and making the play yourself.

My hypothesis has to do with your perceived level of commitment to the person to whom you’re giving advice. You don’t want to give worthless advice if someone asks you for your thoughts on what you think they should do. If you say “yes, Pyongyang is a lovely city to visit!” and the person taking your advice goes there and has a horrible time (apologies to any Pyongyang residents), then you’re going to feel horrendously guilty. So, you invoke prospect theory and attempt to avoid future pain by providing excellent advice so that the person can say “Prague was phenomenal! Thanks for the advice!”

As an aside, Wharton’s Dr. Adam Grant talks about how to use these perspectives in negotiating salary and benefits in his excellent book Give and Take. That book was the inspiration for this article.

Therefore, when it comes to financial decisions in your own life, you may be a little wishy-washy. You might think that vacations are more important than getting rid of your credit card debt or that you should play a little now and not contribute as much to your retirement accounts as you should because you can always work another 10 years, right?

Yet, an independent, outside source is going to figure out the one or two most important goals in your life (it’s why I have my clients do a Six Sigma values exercise) and narrow in the advice to meet those top priorities, preventing the 1/n mental modeling that you might not even realize that you’re doing.

So, if you’ve been stuck spinning your wheels in meeting your financial goals, even though you know objectively what you’re supposed to be doing, it could be due to your limbic system’s diffidence preventing you from acting (long time readers will know that this is our friend Monkey Brain). Even if an outside, trusted source takes your watch and tells you what time it is, that might be enough to kick start your plans and get you on the right path.




About Jason Hull, CFP®

Jason Hull, CFP®, is the Chief Technology officer of myFinancialAnswers, an online comprehensive financial planning service.

Close