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Financial Coach: And Who Are They?

  • Utsav Mishra
  • Feb 22, 2022
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Money is a really important thing. Honestly speaking, it's the most important thing in today’s world. People nowadays are always looking for opportunities to invest their money in different places. 


Be it gold, stocks, or in SIPs or mutual funds. Sometimes this decision turns out to be a really good one, but on some really unlucky days, people lose their money. The risk factor involved with investing is one of the reasons why people think a hundred times before even starting off with their money. 


This process of money management is really tough. To make it easier people have tried many things. Some investment portals even tried to make it easier through technology. 


People were made acquainted with risk management technologies and risk proof investing software. But as we all know it takes time for a population or a brand to trust a new technology. 


That’s the reason why a new profession came to rise. As people were more comfortable listening to other people only, someone decided to invent a new profession called “Financial Coach”.


So? Waiting for risks? You won’t face any of them as you dive in.


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What is a Financial Coach?


A financial coach assists their clients with basic financial management skills. They assist with clients who may have a strained connection with money or face various challenges that prevent them from effectively managing their finances. Their purpose is to assist their consumers in developing long-term financial habits. 


Financial coaches teach their clients about personal finance fundamentals and work with them to develop a financial plan that reflects their objectives. They also encourage their clients to accept responsibility for their actions and hold them accountable as they attempt to put the lessons they've learned into practice.


Over the course of several weeks, financial coaches work with their customers. They frequently meet with clients on a weekly or biweekly basis to offer guidance and monitor progress. 


A multitude of steps make up the entire procedure. The first stage is to become conscious of one's spending habits, which is commonly done by keeping track of daily, weekly, and monthly expenditures. 


The following step is to determine the client's financial objectives, whether it's to create a budget, save for an emergency, or pay off debt. A financial coach will assist clients in developing plans to achieve their objectives and then serve as an accountability partner as they put their plans into action. 


Clients should have increased their financial literacy and be well on their path to reaching their financial goals after six to twelve months.


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What Does a Financial Coach Do?


A financial coach can assist you in developing sound financial habits and setting realistic financial objectives. These can range from day-to-day financial management to long-term goal planning. He or she can assist you in identifying issue areas or financial challenges, as well as developing methods to address them.


Financial coaches, like therapists, meet with clients on a weekly or monthly basis. The duration of this connection can range from a few months to several years. It normally begins with assisting clients in assessing their present financial condition, including their spending habits and areas of strength and weakness. 


They assist clients in setting goals and developing financial plans to achieve those goals while taking into account the client's strengths and weaknesses. A financial coach also serves as an accountability partner, ensuring that customers stay on track to achieve their objectives and improve their money management practices.


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How to Become a Financial Coach?


To work as a financial coach, you don't need any financial licences or certificates. A simple life experience may be sufficient. However, there are several actions you should take to improve your chances of being a great financial coach.


  1. Educate yourself


While there are no formal educational prerequisites to become a financial coach, many experts recommend earning your Financial Industry Regulatory Authority (FINRA) licences or obtaining a more formal degree.


If you're a registered financial advisor who also works as a financial coach, your firm's compliance department will almost certainly need to authorise your coaching practice.


Obtaining a qualification or more formal schooling, such as the Association for Financial Counseling and Planning Education's qualified financial counsellor title, would only enhance your understanding and ability to sell yourself to clients.


  1. Make a niche for yourself.


To be a successful financial coach, you'll need to set yourself out from the competition. Consider your personal financial relationships and experiences. Are there any specific areas of expertise where you can focus your efforts? 


If you were on the verge of bankruptcy but were able to avoid it, you can choose to concentrate on cash flow management and debt relief. Consider centering your financial coaching business on divorce financial planning if you're divorced.


  1. Look for possible collaborations.


Whether you are not a financial advisor, you could contact area advisors to see if a relationship is possible. Every day, financial advisers are juggling a lot of moving components, and it can be challenging to be a consistent accountability partner for their customers. A financial coach could be an excellent complement to the services provided by a financial advisor.


  1. Promote Yourself


If you're going to advertise something, you should be honest about it. Always keep in mind that unless you are a lawyer, you aren't one. Unless you are, you aren't an accountant. Unless you are, you do not qualify as a compliance expert. Pay attention to how you show yourself and your knowledge.


The term financial coach is often confused with financial advisor. So let us try and look at how these two are different.


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Financial Coach vs Financial Advisor


A financial coach can assist you with conserving money, while a financial advisor can assist you with investing and developing your money. 


A financial coach assists individuals who have little assets and require general financial assistance. Clients who require assistance in managing and investing their assets are referred to a financial advisor. 


An advisor can help their customers establish an investment portfolio to help them accomplish their long-term financial goals. In contrast to trainers, who usually charge a flat retainer fee, they usually charge a percentage of the asset under management. 


Advisors frequently require a certain amount of assets to begin working with them.


Another significant distinction is that, unlike advisors, financial coaches are not licensed to provide financial advice and hence cannot make specific product recommendations. 


Coaches can give you general financial advice, but they can't tell you how to manage your assets. They can propose that you save money in a high-interest savings account, but not a specific account.


Coaching varies from advising in that it is usually a one-time contract with the purpose of assisting the client in becoming financially literate and learning to handle their own finances. On the other hand, advising is a long-term partnership in which the adviser meets with their client once or twice a year and manages their financial portfolio on their behalf.


To have a broad understanding, watch this:




Financial coaches assist consumers with day-to-day financial issues. They are limited in the services they can provide because they are not licensed. They can also have a wide range of skills, though there are certification programmes that show a coach has completed specific training and passed a needed exam.


If you wish to become a financial coach you need to know all the important procedures and should have a keen eye on the working process of them. You can also follow some of the famous financial coaches on various social media platforms. While you try to know more about financial coaches, I bid adieu.

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