The Dunning-Kruger Effect is a cognitive bias where individuals with low ability or knowledge overestimate their competence, while highly skilled people may underestimate theirs. This occurs because those with limited expertise lack the insight to recognise their deficiencies, while experts are more aware of the complexity of their domain.
You know this exists but probably didn’t realise it has a name. Since I did some reading on this over the past year it’s became my go to explanation for a lot of things.
This is the reason why, in tax for instance, we have reel after reel on Insta (or whatever they are called on Tik Tok) with what seems like perfectly acceptable advice from property investors on tax that just doesn’t;t quite stack up. They have just enough knowledge to be dangerous as my mother used to say.
It could also explain that even though by any measure I am an “expert” at tax I still hover over the submit button when preparing my own tax return. By the way I am using the simple 10,000 hour measure to determine expertise here not my ego!
I’m on somewhere like 60,000 hours working in tax if we take a simple 2,000 hours a year approach so I am way over the required hours.
What is interesting about this effect is that it affects everybody in some way. I shudder when I hear a client say that their solicitors is drafting some trusts for them only to find out it’s that same person that set up their company and did all of their conveyancing for years. Same goes when I hear someone has got an excellent handyman that is replacing someone’s roof.
Sometimes it happens when you have an accountant that advises on your taxes. Now to be clear some accountants do nothing but tax. That’s fine. They’re probably good to handle your taxes. The problem comes when your accountant is doing 15-20 different jobs in a day across multiple disciplines AND does not know when to hand off work to an expert.
This is the reason I do not do VAT, payroll or accounts as well as many other things. I also don’t arrange my own mortgages or life insurance. you get the point.
What are you currently doing that you might not fully appreciate? I can help you with your taxes of course but may be there are other things.