5 THINGS YOU CAN DO BEFORE YOU SEE A FINANCIAL MENTOR
By Cat Rikihana (Ngāi Tahu)
Cat is an Indigenous Coach (working towards ICF Accreditation), Financial Mentor and Director of Restore Wellness Network.
Financial Mentors and budgeting services are seeing a huge increase in the number of clients wanting to be seen. With the rise in the cost of living many people in Aotearoa are experiencing long waits before they can receive financial mentoring appointments.
With wait times up to three months, there are some things that can be done by people during the wait time. Being prepared for mentoring sessions will ensure that face-to-face time with the mentor will be more productive. It will also help people to set and reach their financial goals quicker.
Here are 5 top tips that financial mentors would love to see you prepare or do before a session:
1. Call your local budgeting service – Get on the waitlist today!
Get on the phone and call your local service. If you don’t know where your local service is you can go to www.moneytalks.co.nz, go to the ‘Find help Now’ tab and put in your location or city. A list of budgeting services and financial mentors will pop up with contact details. There is no harm in putting your name down at more than one service. You may get a spot sooner at one place than another. Just let the other service know you have gained an appointment so they can free your waitlist space for the next person.
2. Collate a list of your debts.
Make a list of the known debts you have. Record who you owe money to, how much you owe and what the amount of your current repayments are. Are you paying weekly, fortnightly or monthly? Are you up-to-date or are you in arrears (behind) in payments? As you get more information add this to your debts list. Having information about the debts you owe will help your financial mentor assess your full financial situation. If you have more details like recent statements, account names or reference numbers these will also help.
3. List all sources of income in and all expenses that go out for payment.
Knowing your income and expenses is what forms the basis of a budget. Make a list of your income, who pays you, how much and if it occurs weekly, fortnightly or other? If you have income that varies or changes (i.e. is not regular) write down your last 6-8 payments and find the average amount and frequency – add this to your list.
In terms of payments going out of your account list who you pay on a regular basis, how much and again, what frequency? Financial Mentors have spreadsheets to enter all your income and expense information and it will let you know if you have money left over (surplus) or more expenses than income (deficit). This initial draft budget will be used to see where changes might improve your money management and to set financial goals. Use a pen and paper to write it all down or you can use the spreadsheets on the Money Talks resource page to get started here: www.moneytalks.co.nz/resources/
4. Apply for your FREE credit score
If having a healthy credit score is something you are interested in you can get free credit score reports from a number of providers. The reports will show if you have any defaults or unpaid debts that have gone to debt collection and the number of credit accounts you have active.
The report will show you what creditors see. For example, you might want to buy a new lounge suite at a retailer. The retailer will do a credit check on you and depending on the budgeting information you have provided and the information that comes from the credit check you may or may not have your credit approved.
Each person has a score from 0-1000 so you want to aim to have your credit score at least over half-way and improving over time. Your credit score can improve over time by paying your bills on time over a long period (utilities, loans, store credit, buy-now-pay-later and credit cards). A financial mentor can help you work on improving your credit score and removing defaults which might help you obtain a rental property, change power companies or even get a future loan, to buy your own home.
Here are some free credit report providers, Illion and Clearscore. They will require you to identify yourself and provide some log-in information: www.illion.co.nz/ www.clearscore.com/nz
5. Start to dream big and write a brainstorm of your life and financial goals
A financial mentor or budgeting service will help you get an overall picture of your full financial situation, your debts, income and expenses, savings and the spending patterns that show up in your bank statements and cash flow over time. You need to think about how you want your life and finances to look like in the future. Brainstorm all the things you want to be able to do financially, the debts you might want to have paid off or the savings goal you have and the details of the dreams and aspirations you want to achieve that might cost you money in the long term. Many financial mentors have been trained to take you through a financial plan of action that reflects on your current situation, what is working or not working, what you want to see in your future and how to compare that with your present situation and then work with you to co-create and encourage action steps or milestones in your financial success journey.
Just doing these 5 steps can give you so much more information about your finances. It will be valuable information to bring to your financial mentoring session and will set you up for success when you are able to get your mentoring appointment. Start today!
The information contained in this document is intended for general guidance and information only and is not personalised to you. It does not take into account your particular financial situation or goals.
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