Are Experts Always Right? How a Second Opinion Saved One Man $6,000
Two years ago, a dentist explained in detail why I needed $6,200 in dental work. And me with no insurance -- ouch! But my first reaction to experts is always skepticism. I checked with a new dentist, who said I needed to floss better, and I kept the $6k in the bank. The lesson: being skeptical of experts can help you save a fortune.
Last month, an air conditioning technician said we need a second air intake to avoid burning out our new compressor. He'd be happy to cut this expensive hole in the wall for us -- and then we would have to regularly replace two air filters. He was very convincing, but I said I’d let him know.
After some serious internet sleuthing, I found the recommended minimum size needed for the air intake on our A/C unit: at least 280 square inches. Our existing air intake is 400 square inches. Wallet stayed in pocket.
Beware of Conflicts of Interest
The pattern is clear: many experts get paid when you take their advice. Isn't it reasonable to suspect they're influenced by the money?
Consumer Reports says doctors order more CT scans and MRI tests when they own the machines. And they mention that angioplasty, a serious surgery, is no more effective than lifestyle changes and medicine, yet doctors routinely prescribe it. Why? Could it be that cutting into people is a lot more profitable?
Meanwhile, the oil change industry has convinced car owners they need to change their oil every 3,000 miles. But if it that was necessary, wouldn't automakers say so, especially when cars are under warranty? Most suggest intervals of 5,000 or more miles. Too-frequent oil changes waste your money and pollute the environment. In fact, the state of California had to start a campaign called "The 3,000-Mile Myth," to combat the waste of oil and resulting environmental problems.
By the way, if your car manufacturer suggests oil changes every 7,000 miles and you stick to that instead of the 3,000-mile myth, you'll save about $100 per year (based on 15,000 miles driven and $35 oil changes).
Speaking of cars, when should you drop collision coverage from your auto insurance? Let's ask Progressive Insurance. They have this helpful tip: "If you have a $1,000 collision deductible on a vehicle that's worth $1,000, you're basically paying for insurance that's not going to pay you when you need it." Makes sense.
After examples that suggest $250 every six months as the cost of a collision premium, they say this: "If you're living paycheck to paycheck, a $500 settlement from your insurance company may be exactly what you need to replace a totaled car."
Really? You should pay $500 every year so if you total your car in the next few years you'll get a $500 check? Well, maybe if you habitually wreck your car every six months.
A Frugal Skeptic's Dilemma
In researching this article, I looked at recommendations from many experts and authorities. Apparently I’ve missed a few important medical screening procedures during the 30 years I've avoided doctors. But hey, at least an article at ScienceBasedMedicine.com agreed with my skepticism about all these tests.
Our cats are supposed to have their teeth cleaned despite the frequency of anesthesia complications and fatalities and the lack of any good research showing that the procedure prolongs their lives (if you're a better internet detective than me and can find a single study proving a longevity benefit, let me know and I'll retract this part).
If you dare to ask them, I suspect various experts would say you need to rip open your walls to check for mold, get your carpet cleaned monthly, visit the gym three hours daily, eat the most expensive organic produce available, and insure everything you own, including your pets and running shoes.
As near as I can figure, if you do everything you're supposed to do according to the experts, you'll need to work overtime for the rest of your life to pay for it all, and you'll have three-and-a-half minutes of free time daily.
What You Can Do
Ignoring all of their advice could save money, but the experts must be right once in a while, so what can you do? Listen to them carefully, but then take these steps:
Ask Other Experts
Getting a second opinion from another expert (or two) is a good idea for most large expenditures. A second dentist saved me over $6,000. Often, second opinions are offered for free, but with the goal of making you into a customer, so be aware of the potential bias.
Do Your Own Research
It's tough to get unbiased in-person expertise for most things that cost money, but you can research everything online now. When gathering information, make sure to look at the credentials of the website or advice-giver, and check the sources quoted in articles.
Use Your Common Sense
Think about the advice you get and ask common-sense questions. For example, the mattress industry recently started their "Replace Every Eight" campaign to scare consumers into buying beds more often. Isn't using a mattress cover a cheaper option? And why do manufacturers offer a 15-year warranty if you're supposed to dump the bed after eight years?
Do the Math
Finally, sometimes a bit of calculation is called for. For example, a home energy auditor might suggest replacing all 30 light bulbs in your home with $12 LED bulbs that use less electricity. That's $360! But if some 60-watt bulbs in closets or the attic are used only 10 hours annually, and you pay $0.11 per kilowatt hour for electricity, replacing them with 10-watt LEDs saves you less than $0.06 per year -- certainly not worth a $12 investment.
You may not like math, but it allows you to effectively challenge the experts. In the case of the light bulbs, it might make sense to replace only the 10 that are used the most, and keep the other $240 in your pocket.
Be skeptical of the experts, and practice the math skills needed to back up your skepticism.
Your Turn: Do you routinely question experts, and has it saved you money?