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How 'nice guy' financial advisor nearly cost Shevonne $200k

·4-min read
Shevonne Hunt has a huge lesson on intuition. (Images: Supplied).
Shevonne Hunt has a huge lesson on intuition. (Images: Supplied).

Trust your gut.

When it comes to navigating the world, listening to your gut or your instinct is often considered one of the best ways to avoid trouble.

However, presenter and writer Shevonne Hunt has a warning for Australians: it’s not always that simple.

Hunt engaged a financial planner in 2018 to help with the sale of her and her husband’s house. It nearly devastated them.

“My husband and I are hopeless with money and we’d been thinking for a while that we needed to get on top of things,” she told Yahoo Finance.

“My parents were really great and they could see that I needed help, so they offered to pay for a financial advisor for myself and my sister.”

They decided on a financial advisor that another close friend of theirs used. The financial advisor was almost a friend of a friend, with Hunt warming to him instantly.

They’d heard that the financial advisor had helped their friend get ahead, and was a good person too.

When they met him, that good feeling was confirmed. The financial advisor was warm and friendly, and most importantly, he didn’t make Hunt feel stupid for not understanding some financial concepts.

“I liked him straight away,” she said.

“My husband was prepared to be quite wary going in because he’s a lot more sceptical than I am about most things, especially when it comes to finances. But as soon as I met him, I thought, ‘He’s a nice guy. He’s going to help us.’”

Today she thinks she warmed to the advisor so quickly because he didn’t seem like a stereotypical advisor to her; he wasn’t pushy or showy.

The turning point

They visited him three or four times and Hunt felt confident the whole time, until she was forced to take a harder look at the financial advisor.

He’d sent her husband a text suggesting an investment opportunity. If they loaned him $200,000, he would deliver returns of 22 per cent.

It was strange, Hunt said, especially given the financial advisor had created financial personality profiles for her and her husband, both making clear they were reasonably risk averse.

“My husband straight away thought it was dodgy. I’m probably a little bit more naive and thought he was trying to help us, but obviously it didn’t matter what I felt because we couldn’t afford to risk that kind of money.”

Hunt’s father had worked in finance and had taught her one cardinal rule: don’t invest, loan or borrow what you can’t afford to lose.

“Part of what was upsetting about it was that he said, ‘It’s totally fine if you don’t want to do it, but I respect what you guys are trying to do.’”

Hunt and her husband decided to step away from the financial advisor.

Within months, it became clear that that was a smart decision.

A million-dollar revelation

Their financial advisor had allegedly been using clients’ money to service ever-increasing gambling debts and a chronic addiction.

All up, he’d allegedly poured $8 million into the addiction, and their $200,000 could have been part of it.

“I don’t understand gambling addictions, or how bad it can be, so I’m lucky that we didn’t lose that money. It would have been devastating for us,” she said.

“So I am in a place of privilege where I can feel compassion. But…the other people who have lost their life savings, I can’t imagine how they could feel compassion.”

Today, she believes her financial advisor is a good man who did the wrong thing.

The whole experience has made her more careful about her finances, but she believes that intuition and gut instinct do still have a place in major life decisions.

The caveat is that that needs to be backed up by strong research and references.

“Get a second opinion. Talk to people. Don’t just rush into it,” she said.

“If you’re going to do something with a person that could be potentially risky, then ask yourself, ‘How well do I know them?’”

You can hear more from Shevonne and others on intuition tomorrow on SBS Insight at 8.30pm.

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