Broker Check

Placebo Planning

May 25, 2018

A placebo, as most of you know, is an inert substance that is administered to medical test participants in place of a drug, during the process of evaluating that drug. Traditionally, a placebo is simply a sugar pill.

In pharmaceutical drug testing, a portion of the test group are given a placebo and a portion are administered the actual drug. The results are recorded and measured to determine if the drug group experienced benefits that were clearly distinguishable from the placebo group. These tests are typically performed “double blind”. That is, neither the tester, nor the test subject, knows which of the two they are administering or receiving.

Why is all of this necessary? Why not just give people the therapy and record their improvement or lack thereof? The short answer is, because it doesn’t work.

The mind can have such a significant short-term impact on the body that simply being administered medicine, especially by a doctor, will often make patients report feeling better. Researchers are not immune to these biases either. If they know who is being given the real medicine and who is not, they will often, unintentionally, give the game away to patients in the study.

The broad intention is simple, to do everything possible to develop medicine that actually works; as opposed to just making us feel better in the short term because we think we have taken medicine.

Sometimes financial planning can be like this. I speak with people who often say things like “Oh, we’ve got that covered” or “That’s all been taken care of.” These individuals feel pretty darn good about having things in place to protect their loved ones, themselves and their businesses.

Unfortunately, and all too frequently, when these plans are subjected to scrutiny, these folks are often shocked to learn that things are not covered or taken care of in the way that they thought they were, much less, the way that they truly want them to be.

Sometimes, there are massive gaps and even entire blind spots in their planning, leaving them naked and exposed to the slings and arrows of outrageous fortune. The way some people find this out however, is only after something has gone wrong.

Certainly, no one wants to find out, when it is too late, that they are engaged in the planning equivalent of taking a placebo. In this case, a “plan” that makes them feel good in the short term yet over the long haul offers no real solutions to the things they are most concerned about. And most dangerously of all, continues to leave them in a state of substantial risk.

This situation does not have to be your fate. If you are intelligent, responsible and family oriented enough to institute planning, take the time necessary to make sure the plan you have will do for you what you want it to.

If you realize that you should implement proper planning and have not yet done so, please, for the sake of you and your family, do so!

Take meaningful action now and be better for it. You might want to speak with a financial services professional you trust, to help you review your plan or help you put one in place.

Scott R. McGimpsey May 25th, 2018

This material was prepared by Scott McGimpsey and does not necessarily represent the views of the presenting party, nor their affiliates. All information is believed to be from reliable sources, however, we make no representation as to its completeness or accuracy. Neither Summit Brokerage Services Inc. nor Scott McGimpsey is engaged in rendering legal, accounting, or other professionally services. If such assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any federal, state, or municipal tax penalty. Moreover, a diversified portfolio does not assure a profit or assure protection against loss in a declining market. UNIFIED PLANNING GROUP is an independent firm with securities offered through Summit Brokerage Services Inc., Member FINRA, SIPC