“Have a mentor.” That is popular career advice, with good reason. A good mentor can help guide you down your career path, help you make smart choices, and be available for you to bounce ideas off of. Having a mentor can help you grow in your career more quickly.
You may have also heard of mentors for finances, specifically investing. Investing can be challenging; why not learn from one who is good at it and can guide you?
However, even if you aren’t at the point where you’re ready to focus heavily on investing, you can still have a financial mentor who can help you get ahead financially. In fact, if you’re struggling financially, you may benefit most from having a financial mentor.
How Can a Financial Mentor Help You?
A financial mentor can help you in a number of ways:
Analyze your budget. A financial mentor can look at your budget and spot any leaks where you’re spending more money than you should. Sometimes having someone else look at your budget can help you see your finances in a new light.
Suggest financial steps to take. A mentor can also make suggestions for your financial future such as how much to invest, how much you’ll need for retirement, and how to save for your child’s college education.
Inspire you. Your financial mentor should be doing well financially. You should be able to look at him and his finances and be inspired. Some day you, too, can be doing as well financially as your mentor.
What Should You Look for in a Financial Mentor?
There are several traits you’ll want to consider when looking for a financial mentor:
Someone who is doing well financially. When you pick a financial mentor, make sure to pick someone who is doing well financially herself. Do not pick someone who likes to give advice but is struggling financially. As Dave Ramsey cautions, “One of the best ways to go broke is to take advice from broke people—like Uncle Earl and your old friend Pete. Listen to those guys and, before you know it, you’ll be invested in a pyramid scheme, leasing a BMW, and taking out a home equity loan to finance that Civil War figurine collection you just had to get.”
Someone you feel comfortable with. If she’s going to act as your financial mentor, you should feel comfortable with her. After all, you’ll be sharing intimate financial details that you likely don’t share with most people, especially if she is going to help you reevaluate your budget.
Someone with the heart of a teacher. Not everyone who is doing well financially will make a good mentor. You also need someone who has a passion for teaching and wants to teach you.
Where Should You Look for a Financial Mentor?
Finding a financial mentor can be difficult, but there are a number of places you can look:
Friends. Do you have any friends who are doing significantly better with their money than you are? This may be the first place to start looking.
Family. Consider all of your family members here—brothers, sisters, cousins, uncles, aunts. Is there someone you could ask for advice who would be willing to teach you?
Church. If you belong to a church, this can be a great place to look as there are many older parishioners who would likely love to teach you how to better manage your finances.
Media. If you can’t find any financial mentors in your own life, look to the media. There are many financial bloggers. Perhaps e-mail one of them and ask if they’d be interested in taking a look at your finances and helping you make smarter choices. Another idea is to explore the teachings of financial gurus like Suze Orman, Dave Ramsey and others. Just be aware that they each have their own biases.
If you haven’t used a financial mentor yet, now might be the time to find one and start improving your finances.