WW 208: Do's and Don'ts of Money Coaching (Coach vs. Advisor) - Solo Show
This week’s episode is something I can’t believe I haven’t created before and is something we dive into in the first week of the Wealthy Coach Blueprint. I’ll be talking about what you should be talking about and giving advice on as a money coach and drawing the line between being a coach and a financial advisor or planner. Loving this episode? Take a screenshot and share it on Instagram! Tag me so I can send you some love (@Tess_Wicks)
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A Quick Recap from this episode
This week’s episode is something I can’t believe I haven’t created before and is something we dive into in the first week of the Wealthy Coach Blueprint. I’ll be talking about what you should be talking about and giving advice on as a money coach and drawing the line between being a coach and a financial advisor or planner.
The Coach’s Job…
Assess The Situation
Ask Powerful Questions
Help Determine Goals
Raise Awareness
Identify Gaps
Remove Indecision
Offer Direction & Guidance
Acknowledge Positive Behavior
Provide Accountability
Give Feedback
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Coach vs. Financial Planner/Financial Advisor/Investment Manager
COACH
Focus: Fundamental Financial Needs, Day-to-Day & Short-Term Goals, Behavior & Habits Focused (Comprehensive or Specialist)
Approach: More Hands-On, Support & Accountability, Done-With-You
Topics & Resources: Budget, Debt Reduction, Credit, Bankruptcy, Goals-Based Savings, Large Purchases (Home & Car), Extra Income, Negotiating Salary, Money Mindset
Education: Employer Benefits, Insurance, Investments, Retirement (analysis)
PLANNER/ADVISOR/MANAGER
Focus: Long-Term Goals, Product or Asset Focused (Depends if Comprehensive or Specialist)
Approach: Hands-Off, Transactional, Done-For-You
Topics & Resources: Cash & Debt Management (usually minimal), Insurance Products, Investment Products, Tax, Retirement Planning & Estate Planning
Education: High-level (if any)
Coaching Do’s:
Set Goals & Priorities
Calculate Net Worth
Develop a Budget
Work on Spending Behavior
Make a Spending/Saving/Debt Reduction Plan
Offer Mortgage/Loan Analysis (Compare & Contrast)
Talk About Salary Negotiation
Offer Coaching to Make Extra Income
Work on Money Mindset
Coaching Don’ts:
Give Investment Advice
Suggest Stocks or Funds to Buy
Give Tax Advice
Suggest Which Insurance Products to Buy
Do Retirement Planning
Give Estate Planning (legal) Advice
Make Promises to Heal, Diagnose, or Treat (therapy or psychology)
DO
Investing: Educate about what investing is, what stocks, bonds, ETFs, funds are (etc), how to find & understand fees, what options are available.
Retirement: Educate about various retirement accounts, employer benefits available, provide retirement analysis (compare & contrast or provide scenarios)
Tax: Educate around how tax works with various tax-advantaged investment vehicles, self-employment income, bonuses, selling things for a gain/loss
Refer to a tax professional (suggest to discuss with tax professional before taking any action)
Insurance: Educate about various insurance products (what they protect/why they’re important), offer analysis (compare & contrast) insurance options.
Legal: Refer to attorney re: estate planning, divorce, business partnerships, etc.
DON’T
Investing: Make suggestions for asset allocation, recommend individual stocks/bonds/ETFs/funds to purchase, make predictions or guarantees on what will happen with their investments/the markets.
Retirement: Create a retirement plan, suggest methods or accounts over others, suggest investment funds or give investment advice (see above).
Tax: Say which account is better for them for tax purposes, give a specific amount to set aside for taxes, suggest to do anything tricky to “save on taxes”.
Insurance: Make recommendations for specific insurance products.
Legal: Give legal advice.
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