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Be careful who you get advice from

by Sam Perren

400 words (2 minute read)

Originally Published: 2014-03-28



If you are looking for financial advice, be very careful who you listen to.

Make sure the advice is in YOUR best interest, and not in the advisor’s.

Case in point: BMO bank advised everyone to lock in mortgage rates two weeks ago, see the feature photo.

Now, big banks are well organized businesses that post billion dollar profits every year. Planning departments are well educated and well informed. These corporations are involved in the minutiae of our financial system.


As industry experts, big banks inherently appear to be trustworthy. (Before I studied finances, anything I was told about money seemed very smart.)

As such large players, big banks are not only experts, they are in the position to influence markets.

If you were about to drastically lower your prices in two weeks, how would you increase your profits beforehand?

BMO did so by telling everyone to lock in fast, before prices go up.

Look what they did next:


For the people who locked in at 3.49% in the past two weeks, this move is a slap in the face.

How much did this bad advice hurt families who were conned by it?

Here is a $300,000 mortgage payment at 3.49%. Payments are $1,489/mo. Balance at the end of 5yr period is $258,792.


The same mortgage at 2.99% has payments of $1,418/mo. Balance at the end of term is $256,374.

That’s $2,418 more that a family had to come up with in 5 years. Enough for a nice holiday or news shoes and clothing for the kids, or 8 new high quality tires for the family car.

In this example, biased advise would cost $23,409 over 25 years.

Tuition for 1st year college perhaps?


What is the lesson from all this?

Before you take the advice that is given, find out what’s in it for the advice giver! Trust, but verify.

That way news like this will not shock you after you did what you thought was the right thing…


Until next time,


About the author: Sam Perren has helped dozens of investment partners aquire real estate, representing over $16Million CAD in purchases with rental income of over $100,000/mo. If you'd like access to Sam's "deal of the week" please click here.