"The Reason Why a Friend's 'Profitable Story' Can Complicate Your Life" — The Psychology of Money Where Trust Backfires

"Who Should I Ask About Investments?"

Ultimately, the quickest way is to ask someone "who seems knowledgeable" nearby. Your gym buddy Frida, your uncle in the financial industry, or a colleague who invests in stocks. An article published by the German news media n-tv on December 28, 2025, organizes the appeal and risks of such "informal financial advice" from both psychological and practical perspectives. n-tv.de

The important point here is not that your friend's advice is always wrong. In fact, it can work well in some cases. The problem is that the "closeness" can easily break the checks and balances, and when things go wrong, the losses can ripple into "relationships". n-tv.de

Why Do We Trust "Friends" Over "Professionals"?

The article gives a simple reason.

• It's free, and the barrier to consultation is low (it doesn't cost time or money) n-tv.de

• Making an appointment and explaining your financial situation is a hassle. Moreover, it's awkward to expose your lack of knowledge or financial weaknesses n-tv.de

• And the biggest point is that financial decisions can't be judged as "good or bad" until years later (you can't conclude based on today's price movements) n-tv.de

This "can only be evaluated later" nature means that, unlike services like restaurants where you "know immediately after eating," there is often a lack of judgment materials. As a result, people end up compensating with "trust" rather than "knowledge." Consequently, they tend to rely more on friends and family they interact with regularly than on professionals they meet for the first time. n-tv.de

When Friendly Advice Becomes Dangerous: "Not Doubting" Is the Biggest Risk

Advice from friends has a unique atmosphere.
"Thinking of you"
"I profited too"
"Everyone's doing it"
The article points out that this leads to "blind trust." While trust is generally a good thing, in finance, it covers up points that should be questioned. n-tv.de

What's more troublesome is that the cost of failure becomes double.

• Money decreases

• More than that, the awkwardness of "recommended/recommended to" remains

Financial losses don't just end with numbers decreasing. Apologies, discussions of responsibility, changes in distance... The saying "money talks break friendships" becomes a reality at this stage. n-tv.de

Even "Good Products" May Not Suit You: The Lack of Individual Design

The article uses ETFs as an easy-to-understand example. While ETFs are said to be suitable for long-term diversified investments, if you suggest the same to someone who plans to buy a house in the near future, it can lead to a mismatch. n-tv.de

So the problem is not that "a friend recommended ETFs," but that
the purpose (what for) / duration (when to use) / risk tolerance (how much can you endure)
are not shared or confirmed, and "general advice" is thrown around.

Consumer protection experts compare this to medicine. When you have a persistent headache, you shouldn't just take a friend's medicine; you should get diagnosed—it's the same with finance, you need to check the "symptoms" before prescribing. n-tv.de

The Real Fear Is Not "Goodwill" But "Incentives"

The article also emphasizes another point of caution.
When friends or relatives "overly eagerly" recommend specific products, it may be because existing trust relationships are being used as "sales tools" as part of a business model. If referral fees or commissions are involved, the advice is no longer neutral. n-tv.de

The important thing here is not to doubt and condemn the other person. Rather, in many cases, they recommend it because they genuinely believe it's good. That's why it's necessary to include "interest confirmation" as part of the system.

Still, "Friend's Advice ≠ All Bad": Research Shows an Unexpected Aspect

What's interesting about the n-tv article is that while discussing risks, it also includes a perspective that "friend's advice is not always bad." n-tv.de

In fact, research around SAFE (Leibniz Institute for Financial Research) introduces the idea that people who followed recommendations within their personal networks tended to have higher quality portfolios. safe-frankfurt.de

However, there are conditions. It's noted that the research subjects may be skewed towards relatively wealthy and financially literate groups, and if the same behavior spreads through "loose connections" like SNS, the quality may actually decrease. n-tv.de

SNS Reactions: "Relatable" and "Still Can't Trust Professionals" Coexist

The theme of this article is also "relatable" on SNS. n-tv itself shares the article on platforms like X. X (formerly Twitter)

From here, rather than determining the truth or number of individual posts, I want to organize them as reaction patterns that repeatedly appear on SNS/communities (as actual examples, I also refer to posts on investment-related boards/communities). Reddit

1) The "Can't Refuse a Friend's Story" Problem

On boards, there's a "relatable" story of being endlessly talked into buying by a pushy friend. If it goes up after buying, it becomes a heroic tale; if it goes down, it becomes a dark history. Reddit

2) Frustration Over "If It Profits, It's a Credit; If It Fails, It's Your Responsibility"

Even if the "advising side" said it lightly, the receiving side bears it heavily as a life decision. This gap tends to create anger and resentment. n-tv.de

3) Distrust in "Aren't Professionals Also After Fees?"

Even if friends are said to be dangerous, there's a strong backlash of "but banks and firms can't be trusted either." In fact, there are investigative reports showing a certain number of people choose family and friends as their financial information source. DIE WELT

4) "Investment Stories on SNS Are Even More Dangerous"

There's also noticeable caution towards "influencer-like advice" that is more distant than friends. The tendency for younger generations to gravitate towards investment information originating from SNS is repeatedly reported by overseas media. The Washington Post

So, What Should You Do?—"Safe" Ways to Ask and Engage According to the Article

Implementing the n-tv article's suggestions for Japanese readers would look like this.

Before Asking Friends: The Minimum 3-Point Set

1. Purpose: What is the money for? (Retirement/Education/House Down Payment/Surplus Funds) n-tv.de

2. Duration: When will you use it? (If within 2 years, be cautious about the risk asset ratio) n-tv.de

3. Acceptable Loss: How much of a drop would keep you up at night?

If Recommended: Don't Miss These Questions##HTML