CEO Tom Gardner: Pay Only for Advice "Aligned With You." Otherwise, Index.

Tom Gardner is the chief executive officer of The Motley Fool, a company that vides investment advice

When asked, "What do you say to somebody who's skeptical paying for investment advice. " He gave an answer that covered a lot of ground and, not surprisingly, sounded a lot what icon Warren Buffett has said

Be skeptical, work with people you trust, and if you can't find someone you trust, go with an index fund

But digging into Gardner's answer a little bit more will help you be a better investor, so let's go

You should be skeptical Every investment you make requires you to trust someone else with your hard-earned savings

That is the core of what Gardner is saying and why he believes every investor should be skeptical

Image source: Getty Images

From a basic level, you need to ask and understand what the person or entity is doing with your cash and why

But even more importantly, you need to trust that the person or entity that is on your behalf is doing so with your best interests at heart

Far too often on Wall Street, greed leads people to do things that are harmful to themselves or, sadly, others

Are they eating their own cooking

One of the best ways to figure out if you can trust someone is to invest alongside them

Basically, are they pitching you an investment idea they are also invested in

That's where Buffett and Berkshire Hathaway vide a great example

Not only is Buffett the CEO of Berkshire Hathaway, but he's also heavily invested in the stock himself

He's not just managing your money, he's managing his own money, too. (The Motley Fool recommends Berkshire Hathaway stock, by the way. ) What's interesting here is that Berkshire Hathaway is a company, but it is operated kind of a mutual fund

But when you buy Berkshire Hathaway, effectively giving Buffett and his team your hard-earned cash to invest for you, you know he's eating his own cooking, too

Gardner, Buffett has some advice for those who aren't comfortable allowing others to invest for them: Just buy an index fund

Essentially, just buy the market and keep on buying it until you find someone you are comfortable trusting with your savings

And if you never find that person, it's OK

SPY data by YCharts Trust is the name of the game on Wall Street Most people have good intentions, so it isn't you need to assume everyone on Wall Street is trying to rip you off

And still you need to take the time to get to know and understand the people you are trusting with your money

Even after doing some due diligence, though, you might still want to tread lightly

That could be as simple as taking an entry level subscription to a Motley Fool to get a feel for what is being offered or buying a few s of a stock, mutual fund, or ETF to get you into the groove of what is backing the investment

And remember that one of the most important signs that your interests are aligned with the person handling your money is if they are your money along with their own

Reuben Gregg Brewer has no position in any of the stocks mentioned

The Motley Fool has positions in and recommends Berkshire Hathaway and Chevron

The Motley Fool has a disclosure policy.