Money Advice Canadians Should Ignore

When Jason Evans went downstairs one evening, he found his mother frantically searching through boxes. As any helpful 15-year-old would, he offered to help. He could hear the urgency in her voice as she rifled through papers. “She was panicked, and it got to the point where she became paranoid that the documents were stolen,” Evans recalls from Winnipeg, more than two decades later. She needed files for a securities commission proceeding and feared she might lose the house. His father had died seven years earlier, and after following poor financial advice she had borrowed against the home to invest in the stock market. When the markets plunged, the mutual funds in her portfolio collapsed.

Poor financial advice is widespread—and for many Canadians it has real consequences. In a MoneySense poll conducted online from October 4 to October 30, 2023, with 891 respondents across Canada, 69% of readers said they had lost money as a result of financial advice. The survey explored bad money advice, scams, FOMO (fear of missing out), and trusted sources of financial information.

What’s a trend and what’s just bad advice

When asked “What financial trend have you bought into?” nearly half (48.93%) said none of the listed trends applied to them. Among those who did, the top trends were heavier allocations to guaranteed investment certificates (GICs) at about 16%, tech stocks at 13%, and rental properties at 13%. Respondents could select more than one option; the table below shows the full breakdown.

“GICs are competitive right now,” says Jason Heath, an advice-only financial planner and MoneySense consulting editor. “They can be a solid option for conservative investors or for people who need a shorter time horizon for their money.”

On crypto, Heath warns that it’s a complex and highly volatile asset class. “The investors I worry about are those with large allocations. Young people building wealth or retirees drawing down are often poorly suited to heavy crypto exposure. A small allocation may make sense for some, but many should approach it cautiously.”

Jonathan Chevreau, MoneySense’s Retired Money columnist and investing editor-at-large, says he keeps only about 1% (or 2% in a lucky year) of his portfolio in Bitcoin ETFs. “GICs and crypto sit at opposite ends of the risk/reward spectrum,” he notes. With some Canadian GICs offering around 5% today, laddering GICs can be a practical, unemotional way to lock in returns across varying interest rates—similar in principle to dollar-cost averaging for equities.

Are pyramid schemes still around?

The survey shows almost 1 in 10 respondents (8%) said they’d been burned by pyramid schemes. Illegal in Canada, these schemes promise large returns with little cost and rely on participants recruiting others. Often, victims pay significant fees and are told to recruit family and friends to recover their money.

“I don’t think pyramid schemes will ever disappear,” says freelance writer and former investor Stephanie Griffiths, CFA, MFA. “The internet and social media have given them new life.” Traditional envelope-stuffing scams have evolved into fraudulent apps, hacked accounts and persuasive pitches sent via social platforms.

Text messages to emails to a knock on the door: What scams look like today

Phishing and impersonation scams have become increasingly sophisticated. Many people now receive convincing messages that appear to come from friends or legitimate services, urging them to click links, log in, or transfer money. Those messages can feel urgent and alarming—exactly the reaction scammers rely on.

Sixty-one percent of survey respondents said it’s getting harder to spot scams delivered by text, email, phone calls or even in-person visits.

“Technology has two sides,” Griffiths says. “It gives instant access to company filings and other useful data, but it also makes it easier for scammers to build convincing fronts and reach many potential victims.”

Some practical tips: do not opt in for transactional texts from financial institutions, never follow a text that asks you to log in or transfer funds, always check URLs before signing in, and remember that promises that sound too good to be true usually are.

Check yourself: Are you being emotional?

FOMO—fear of missing out—drives many impulsive financial decisions. In the survey, 55% of respondents admitted to experiencing FOMO when investing.

Certified Financial Planner and Certified Financial Behaviour Specialist Shaun Maslyk explains that FOMO often reflects deeper emotional needs, like a desire for recognition or status. “FOMO isn’t really about money itself,” he says. “It’s about the feelings and stories we attach to money.”

Heath adds a reminder to be intentional: “Reacting to trends rather than following a plan increases the risk of failure. Asset bubbles—from 17th-century tulipmania to NFTs—are like musical chairs: the last person left often loses. A home should primarily be a place to live, not just an investment. Rental returns, if pursued, should be realistic and often resemble mid-single-digit returns comparable to a diversified portfolio.”

Where to get good advice

Survey respondents use multiple sources for financial guidance. The most popular were specialized finance media (78.7%), financial advisors or planners (53.0%) and books (45.5%). The table below lists the full responses.

But source quality matters. Chevreau warns about subscribing to speculative investing newsletters: many pitch risky bets and get-rich-quick themes that can cause steep losses. He favors a steady, diversified approach—“get rich slowly”—using dollar-cost averaging and a long-term plan to reduce emotional decision-making.

Why do we fall for bad advice?

Humans naturally seek validation, and bad advice often plays on that desire—promising quick wealth, easy financial freedom, or overnight success. Maslyk notes that understanding why you feel drawn to certain advice—what fears or hopes it taps into—can help curb impulsive money decisions and reduce FOMO-driven mistakes.

Bad advice isn’t just about losing your shirt

As for Evans’ mother, she did find the documents she needed. In 2005 the Manitoba Securities Commission found the leverage-based advice she received to be unsuitable, and she did not lose the house. She later found a trustworthy planner who established a trust for her children. Evans, whose mother died in 2006, says the episode left a lasting impression. Now a Certified Financial Planner and owner of Evans Retirement Planning in Winnipeg, he says the experience shaped his career path: when a local firm asked him to solicit 50 acquaintances and sell them investments, he decided to pursue advice-only planning instead. “That situation left a mark on me,” he says. He now encourages people to increase their financial literacy so they can recognize risky advice.

50 pieces of the worst financial advice

Survey respondents submitted nearly 900 examples of bad advice. Here are 50 of the worst and most common snippets they reported:

1. “Just about everything. No one knows how the big picture will unfold.”
2. “Everyone lives in debt.”
3. “Don’t worry the dividend is safe.”
4. “Renting is throwing away money instead of buying a residential property.”
5. “Buying a stock on a hot tip that was BS.”
6. “You can time the market.”
7. “Trust this person because someone else does.”
8. “An advisor who wanted me to switch investments, in order to buy low and sell high. Of course it did not work too well. No one can time the market consistently.”
9. “Sell because the market’s going to crash.”
10. “That there is ‘safety’ in blue chip stocks.”
11. “Talked into buying risky mutual funds for RESPs when this should have been placed into safer investments.”
12. “Borrowing money to buy an RRSP with the intention of withdrawing to purchase a home.”
13. “Keep cash in a defined benefit.”
14. “Some of the worst advice I’ve ever received has been from myself. I have sold on the way down, bought at the peaks and held on to losers.”
15. “Advisor tried to convince me to take a home equity loan to use in my investment portfolio.”
16. “Buy Nortel.”
17. “Investment advice from a friend who turned out to be a scam artist.”
18. “I invested in penny stocks once and lost most of my investment.”
19. “Don’t invest until your debt is paid off.”
20. “I was told to wait until I had six months’ savings, so I didn’t invest for 30 years.”
21. “Pay off the mortgage ahead of savings, when I was in my 30s.”
22. “Buy mutual funds with deferred fees when I was new to investing; the fees weren’t explained.”
23. “My parents didn’t teach their kids about money.”
24. “Invest in a micro-brewery started by a family acquaintance.”
25. “To invest in a friend’s company because it was a sure thing.”
26. “Just about anything my husband suggests.”
27. “Marrying a big spender.”
28. “Trusting someone else completely with financial decisions.”
29. “Buy rental properties during a building boom to reduce taxes—ended with losses.”
30. “Not to purchase a rental property many years ago.”li>
31. “Buy a rental property—what a headache.”
32. “Not cashing in BlackBerry stocks when the company was at a high.”
33. “Chasing the next fad ‘investment’.”
34. “Index funds always beat GIC rates.”
35. “Buy crypto; it’s really a pyramid scheme.”
36. “Hang on to everything; the market will soon rebound.”
37. “Buy weed stocks.”
38. “Invest in cannabis and trendy food stocks—both flopped.”
39. “Meme stocks to the moon.”
40. “Investing in a timeshare.”
41. “Buying high-fee bank mutual funds.”
42. “The government will take care of you when you retire.”
43. “Buy term insurance at 22 instead of keeping a valuable whole life policy.”
44. “Join my program/course/membership to escape the matrix.”
45. “Moving all our money into one brokerage and following their buy suggestions blindly.”
46. “Buy more shares in the startup company I was working at. It went under.”
47. “Don’t invest in your company stock—I did and made $60K.”
48. “Lend me money, I’m good for it.”
49. “Put all purchases on a credit card to earn points.”
50. “To build your credit score, take out many credit cards and max them out, making only minimum payments.”

Read more about financial literacy:

• The MoneySense Glossary for personal finance and investing terms—for Canadians
• The best free personal finance and investing courses in Canada
• How to deal with money and your finances when the economy is stressing you out