Some companies do a very good job of helping you learn about financial basics. After all, it’s in their best interest that people understand money matters and make good choices. The challenge is to separate the helpful information from biased sales information. Here’s how.
Is this information I can trust?
Use this checklist to help you evaluate the information you get from web sources.
- Does this source give me information, or a sales pitch? If there is a lot of advertising and the source mostly promotes how a product could help you, then you are likely getting a sales pitch. Tip: Watch out for websites that suggest that you contact someone in the company or try to get you to provide personal information so they can contact you. They may try to sell you a product before you are ready to buy, or before you feel you have done all of your research.
- Does this source help me learn about my choices? A good commercial information source will try to show you your options. They may provide links to other good information sources. A few may even provide links to competitors' websites, although most don’t. Tip: If the site claims to be answering your questions, and then mostly ends up saying that one product is the answer to all your needs, you are likely reading sales information. Good sources should make you feel better prepared to make your decisions, but they shouldn’t make the choices for you.
- Does this source tell me about the possible drawbacks of an investment, such as high risk? If you are only learning about the advantages and not the drawbacks, then you are likely getting sales information. Good sources will explain and help you to understand both. They will also help you understand the things that can affect how an investment will perform so that you can make an informed choice. Sales material focuses only on good news and good returns.
- Does this source have a good reputation? Usually the better information sources are quite well-known. You often hear about them from someone else who has found them helpful.
Remember: Some company sites only want to sell you something.
Also, some sites are more helpful on some areas than others. You may want to bookmark the ones that have good information on topics that interest you.
Is it independent research or paid promotion? This OSC Investor Alert explains the difference.
Content in this section is provided in partnership with the Investor Education Fund, a non-profit organization promoting financial literacy to Canadians. To find out more go to GetSmarterAboutMoney.ca.