Most of us will probably need some financial advice from time to time, but how do we know if we’re getting good advice? Clearly we want something that covers all the bases while being
affordable and practical. Most important, it must be a lasting solution, not a quick fix.
Exercise Your Money Muscles
Let’s look at our metaphor of physical fitness. You don’t go to the doctor or your personal trainer every day. You’ve got daily habits to maintain that don’t require the caliber or expertise—or the expense—of daily checkups. These are long-term habits for a lifetime, and no one can exercise for you!
Similarly, you won’t talk to your financial advisor every day, and advisors don’t dictate your penny-by- penny expenditures and savings for you. So obviously getting financial advice that leads to real financial fitness requires effort. Never fear: We can keep this relatively pain-free with a simple three-fold plan.
Three-Fold Financial Fitness Strategy
Here’s a straightforward, realistic strategy for going from financial “flab” to financial fitness:
#1: Learn What to Do
You can easily find information on diet and exercise. It’s the same with finances. Education is your first step, and there are a number of resources available. Financial literacy gives you basic knowledge and techniques for good money management.
Some of us have bigger learning curves than others. Here are some of my favorites for different levels of learning:
For the basics, Dave Ramsey’s Financial Peace University: This 13-week course covers the most critical areas, including debt elimination, insurance and investment basics. Ramsey’s style doesn’t appeal to everyone, but he does a good job of entertaining while he is educating.
For clever tips, Get Rich Slowly: This is one of the most popular personal finance blogs out there. I often learn something new or benefit from looking at things from a fresh angle.
For sound investment info, the Bogleheads forum and wiki: These cover the basics of do-it-yourself index investing. The main page is a bit overwhelming, so click Getting Started at
the top for a gentler introduction, then drill down from there.
#2: Start Doing It
Learning what to do is easy. The difficult part is doing it! There are plenty of resources to educate us but not much to help us consistently maintain good habits. We’re human, and we need regular reminders. Just like you’d join a dieting club or take an aerobics class, you need a financial fitness program to make the right money moves consistently.
A financial fitness program involves getting others’ support for maintaining good financial practices on an ongoing basis. It’s hard to find a financial fitness program that’s comprehensive and designed to meet human needs around finance. That’s the primary reason I started Moneymentals. Right now, the Moneymentals community is unique in the marketplace. If you choose to join, you’ll build your personal plan during a Moneymentals webinar facilitated live by me personally. Learn more about how it works, and tryit out! You’ll be part of something fun and new.
#3: Get a Coach
Ahh, here’s where the financial advice comes in! Sometimes you need the individualized attention and expertise of a doctor. Likewise, you can go to your financial advisor for periodic checkups. Now that you know the ropes, you won’t need hours of costly financial advice, just a little when you have questions. Often that advice will involve not what to do, but how. You wouldn’t trust a snake-oil salesman with your health, so be cautious when choosing a financial advisor. For most people, fee-only advisors who work on an hourly basis are best. First, they lack commission biases. hey also maintain a fiduciary standard, so they put client interests first. Because they’re hourly, you can decide how much assistance you want and what kind. Need help finding the right advisor? . An good source for fee-only advisors is www.NAPFA.org. Not all NAPFA member advisors will work on an hourly basis, but many will.
Wealthy Habits
Thinking you can get by with poor money habits and somehow catch up later is a proven formula for failure. The best time to start practicing wealthy habits is today and every day. So learn the basics and get started. A good financial fitness program will serve most of your needs, and you can see an hourly fee-only financial advisor when you need a pro.