Do you financially mentor?

[Gumby]

As I was informed (only partly in jest) upon starting my first job out of law school -- "The firm likes you to have a big mortgage".

 

[kjrn]

In our ICU, I was the last (unofficial) stop for new orientees. I had a spiel I would do ("The company has some money they would like to give you, but they're just as happy if you refuse. Did you want to go ahead and let them know that you don't need the extra bucks?"). That led into what the 403B is etc.

Those that wanted to enroll but didn't know how were assisted with logging on/signing up. Target funds were recommended along with a reading list (just in case someone wanted to do their homework).

We had a participation rate of almost 100% (including 20-somethings and lower pay-scale ancillary help). Everybody pretty much got on the bandwagon and it wasn't just my soapbox after a bit. Folks that announced they had raised contributions got lots of positive reinforcement from the whole staff. Neat stuff.

Now my family is a whole different story.

 

[crazy connie]

I love to talk money - especially to young people. If I think they are interested I will mentor until I feel that that there really is not interest. Sharing with young people, the principles that most don't learn until their 40s and 50s is a thrill for me.

Same here! I am apalled at some of the ignorance in my childrens friends. We have had many a night discussing broadscale finance. Some have signed up for 401K's from our dinner table chats. My daughter at 23 is contributiong 18% to her 401K. Soon my son may get a job with that benefit. Hopefully my kids will be targeting FIRE at 50 without the inhieritance!

 

[TromboneAl]

The sax player in my group is off to Berklee College of Music in a few months. I'm thinking of getting him a book on money for a going away present, either:

Complete Idiot's Guide to Money for Teens or

The Motley Fool Investment Guide for Teens: 8 Steps to Having More Money Than Your Parents Ever Dreamed Of (Motley Fool)

Any other suggestions?

 

[Nords]

The Motley Fool Investment Guide for Teens: 8 Steps to Having More Money Than Your Parents Ever Dreamed Of (Motley Fool)

Our 14-year-old loves hers.

Right now she has more money in her checking account than I do, but then she has one more paying job than I do too...

 

[SecondCor521]

Our 14-year-old loves hers.

Right now she has more money in her checking account than I do, but then she has one more paying job than I do too...

And marginally smaller expenses, I would think.

2Cor521

 

[Celany]

"Have you financially mentored in the past

mentored sounds so 'official' to me. If you're asking if I'd spoken openly about my money situation to other people, in hopes that it'd help them, then yes.

did you do it unsolicited?"

I don't think so. I've never randomly said "you should spend less money & put it into Vanguard Index funds". Acting like a know-it-all, or even remotely seeming to *tell* someone what to do tends to make them run the other way.

For instance, I am an EXTREMELY health & food concious person, but whenever a vegetarian or raw foodist tries to lecture me about how much healthier I could be, or what I could be doing 'better', I get the urge to run off, buy a big mac & eat it right in front of them.

Any suggestions for broaching the subject in a way that will be effective?

I talk about myself. I've practiced confidently saying things like "I can't eat out tonight, I already ate out once this week & I want to save my money for other things" or (in the bookstore) "wow, that looks like an awesome book...I'm going to look it up on half.com when I get home" or (when asked about my tax return) "I put my tax refund into investments. It looks like I'll be able to retire X years earlier now, as long as the market doesn't crash".

I've found that, over time, some people have been curious to know more. I generally point them towards Personal Finance for Dummies, Mutual Funds for Dummies, & Your Money or Your Life. I also practiced some "soundbites" little things to talk about that aren't too detailed, to whet someone's mental appetite (when they've indicated that they're interested) without bogging them down with too many details.

 

[Alex]

I've taught the basic principles of money management to many friends and family members and recommeded books. But only at their request. I don't offer unsolicited financial advice to anyone, ever.

 

[citrine]

Trombone Al.....these two books really helped me out:

The Millionaire Next Door
Your Money or your life

I understand that sometimes the best way to show someone is by your actions. However, I have heard of so many instances where the women are just left without money, left with the kids, no retirement funds, and no current job skills.
It kills me to see young women be so apathetic about their financial lives.

I have also been on the opposite side of this....when I was 25, my father would hound me all the time about contributing to the 401K and once that was done....he hounded me about increasing my withholdings....by the time I got to 15% it became a game for me....now I contribute 25% and my quality of life is pretty darn great!

 

[LOL!]

Our second in command at our company took me to lunch today specifically to ask me for investment advice for his personal accounts. It's amazing how much information about asset allocation, low fees, tax efficiency can be conveyed without ever mentioning dollar amounts in the "assets under management". Simply using a range of percentages gets one almost all one needs to know. The only note he wrote down was "Vanguard".

 

[Donzo]

Yep, everychance I get...in a fun "what if" kind of way. I have had calls after a general discussion for more info. Don't wanna be pushy nor aloof. If I can change anyones attitude towards their own future/savings, in a positive way ---it's all goood 8)

 

[kcowan]

I have attempted to mentor my sons about investing. They are not receptive. They were given strong financial principles when they grew up so they save and buy little on credit. But they are now in the 30s and I want to help them get richer than by chasing stock tips. They are proud and self-sufficent so I guess I should be happy and leave them alone.

I guess I will just recommend indexing for their company pension plans while paying off the mortgages as fast as possible.

Once in a while others ask for recommendations and I say very little. I talk about the 70/30 split and going for low MERs in broad asset exposure funds. But I avoid specifics. I have found it too complex to get into the details about our strategy.

 

[Andy H]

As a professional...

It's funny, even as a successful financial advisor, I'm occaisionally frustrated at the resistance that family and friends as well as aquaintances have to listen to "free" expertise.

I think the problem is that most people believe themselves to be adequately educated on the "conservative" approaches to finance (eg: save more, spend less, buy low, sell high, pay extra on your mortgage, yada yada), and have an equal amount of professional skepticism that results in their inability to HEAR or to a greater degree TAKE ACTION on anything that challenges their self-proclaimed "conservative" nature.

What I find in my practice, is that people ARE NOT conservative...rather they are CONVENTIONAL. Meaning simply that any advice that would require that they do something "different" presents them with a monumental challege. They fail to recognize that doing what they've always done and doing more of the same, will result in exactly what we have as a nation: More credit card debt than ever in our history, less equity in our homes than ever in our history, a negative savings rate, underfunded retirement accounts, a social security system and tax system that will eventually fail us without major reform etc.

We have to do something different but different does not mean RISKY or less conservative!

Occaisionally I have the opportunity to speak in public forums and I preach the following: financial success is ultimately largely governed by two components: 1) CONTROL over one's finances and 2) understanding Conservative vs. Conventional and overcoming resistance to change.

I have a good little story about lemmings and conservative vs. conventional but I'll save that for another post.

 

[laurence]

I can't help it, I'm the financial advice equivalent of the crazy cat lady down the street. I can't stop babbling about it. I've even given "4 pillars" as a wedding present (along with a Home Depot Gift Card - I'm not that bad). At first I was discuraged by the lack of response, but I think a lot of people have made little changes due to me. Getting out of or not buying crazy annuities, consolidating debt, increasing 401k contributions a % or two, finally enrolling in the pension at work, that type of thing.

 

[cj]

Laurence - I'm like you. There's a young woman I've worked with for about a year who swears that before I even said "hello", I asked her if she signed up for the 401K.

CJ

 

[laurence]

I get those kind of comments, too! I figure everyone hears enough of "buy it now, you deserve it!" from the rest of the world, if I can become that nagging voice in their head to make them hesitate on buying that $1,000 blender, well, all the better.

 

[Sarah in SC]

Laurence, don't feel bad, I'm both the crazy cat lady AND the one who babbles incessantly about savings, 401k contributions, etc.
I'm inviting a bunch of family and friends over this weekend for a torturous lesson in money skills--our mortgage burning party! Either it will make them more likely to save money, or make them more likely to ask us for money!
Sarah

 

[OAG]

Only family, sons and daughters. Wasted time on sons but much better spent on daughters. Sons will listen but then go do whatever the "friend(s)" tells them; frustrating. Currently, sons do not tell me what stupid things they did lately and I have learned not to ask; much easier on the relationship. Daughters just seem to get it quicker. I try to take no credit, nor any blame, just say it once and hope for the best.

 

[Getting short]

I've mostly just mentored my daughters. But they got a life lesson early on when their dad died 10 years ago. We did not suffer a major financial adjustment due to his good planning and my working. I have ingrained in them the idea of FI as you never know what life has in store for you down the road. When the oldest started earning money I opened a Roth for her and matched her earnings to teach her the importance of saving early and always. LBYM and not carrying debt are a given in our house (paid off the mortgage in June ).

With me looking at ER in a few months at the age of 55 at the same time the oldest is entering college, most other parents and coworkers think I must be crazy, but my kids know that we're financially sound and know that it came from lots of planning and the fiscal values we live by. Don't get me wrong, my girls like to buy nice things like any kid, I just insist on explaining to them the realities of how to make and keep the lifestyles to which they have become accustomed .

 

[hova22]

Our response was "We're driving cars that reflect our values, not our bank accounts. We'd rather put the money in our retirement portfolios."

This is a great statement. Definitely going to use it.

When conversation with friends, family, and coworkers drifts toward investing/retirement topics, a passion is ignited from within. However, I am carefull with my words based on the audience and their reception of my knowledge.

I dream of one day being FIRE and starting a financial planning business catering to the middle/lower class. Charge a small hourly fee, work with people coming to you for help, and serve a market whose lives can benefit significantly from the advice.

Has anyone else ever contemplated this? Maybe waiting until FIRE is selfish and pursuit of the dream should begin now...

 

[Andy H]

HOVA! PURSUE THE PASSION! This is LIFE, not practice. We only get one shot...it doesn't have to mean that you forgo your income entirely, simply that you'll have the fulfillment of contributing to the benefit of others who need it. WOW, I admire you and join you in that quest! Just start with a simple offering, get it to as many people as you can and know that the impact you have will be great! Being independent, I have the ability to do what's right without answering to an accountant and bottom line - I've given away lots of time when the need is there because perhaps selfishly, the reward is way beyond money! Good for you!!!!

 

[boutros]

nope

I dream of one day being FIRE and starting a financial planning business catering to the middle/lower class. Charge a small hourly fee, work with people coming to you for help, and serve a market whose lives can benefit significantly from the advice.

Has anyone else ever contemplated this? Maybe waiting until FIRE is selfish and pursuit of the dream should begin now...

Noooooo. This sounds like a nightmare. It would be the most annoying boring job in the world. You would serve people who would never follow up on, much less understand your advice. It would be like beating your head against a wall 8 hours a day.

Maybe 1/10 client would provide any fulfillment.

IMO, This is just a terrible idea.

I hope you don't find that insulting. I am sure you would love doing it just like some people love beating their heads against a wall.

At least its not "conventional."

 

[hova22]

Thank you for the encouragement!...

This is an incredible article on the 'pursue what you love' topic...
How to Do What You Love

Sorry, not intending to hijack the thread, it felt relevant to the financial mentoring topic at hand...

 

[Getting short]

hova,
I'm interested in doing something along the same lines, providing college guidance counseling to Latinos in my community. There are so many opportunities for underrepresented minorities, particularly those that come from low income families. The problem is that they are usually unaware of these opportunities and the local high school counselors are not in addressing this sector of the population.

Your idea is wonderful, go for it!

 

[boutros]

HOVA! PURSUE THE PASSION! This is LIFE, not practice. We only get one shot...it doesn't have to mean that you forgo your income entirely, simply that you'll have the fulfillment of contributing to the benefit of others who need it. WOW, I admire you and join you in that quest! Just start with a simple offering, get it to as many people as you can and know that the impact you have will be great! Being independent, I have the ability to do what's right without answering to an accountant and bottom line - I've given away lots of time when the need is there because perhaps selfishly, the reward is way beyond money! Good for you!!!!

It sounds like someone is about to get a PMed with details on an exciting opportunity with Primerica Financial.

(just kidding)