What Is a Financial Coach, and How Can They Help?

Unlike other financial professionals, financial coaches focus on building foundational money skills, things like managing spending, setting savings goals and creating a budget. They typically don’t offer investment advice, tax planning or portfolio management. For those more advanced needs, financial advisors, especially Certified Financial Planners™ (CFPs®), remain an important resource. These professionals help investors develop and maintain strategies aligned with their financial goals, time horizon and risk tolerance.

If you’re looking to work towards certain goals, consider working with a financial advisor.

What Is a Financial Coach?

A financial coach helps clients build a strong foundation in money management. They often work with individuals who struggle with financial habits, have difficulty budgeting or feel overwhelmed by their financial situation. The primary goal is to help clients develop lasting, healthy money behaviors.

Financial coaches focus on education and empowerment. They teach the fundamentals of personal finance and work with clients to create a personalized plan that aligns with their goals, whether that’s building an emergency fund, paying off debt or setting up a sustainable budget. Coaches also encourage clients to take ownership of their financial decisions and provide accountability throughout the process.

Coaching typically takes place over several weeks or months, with regular sessions, often weekly or biweekly, to assess progress and offer guidance. The process generally includes:

Building Awareness: Tracking spending habits daily, weekly and monthly to identify patterns.
Setting Goals: Defining clear financial objectives, such as debt reduction or saving for future needs.
Creating a Plan: Developing actionable steps to reach those goals.
Providing Accountability: Offering ongoing support and encouragement as clients follow through.

Over the course of six to twelve months, clients usually gain greater financial confidence, improve their financial literacy and take meaningful steps toward long-term financial stability.

Who Do Financial Coaches Work With?

A man overwhelmed with his finances, before deciding to reach out to a financial coach.

Financial coaches typically work with people who want help improving everyday money habits, setting goals and building a stronger financial foundation. Their clients can include young adults managing money independently for the first time, families trying to organize household finances and individuals who want more accountability around spending and saving.

A financial coach may also work with people who are paying down debt, building an emergency fund, creating a budget or preparing for a major financial goal such as buying a home. Rather than managing investments directly, coaches generally focus on helping clients understand their behavior, establish practical routines and stay on track with a financial plan.

People experiencing a major life transition may also seek financial coaching. A job change, marriage, divorce, new child or shift in income can create new financial priorities, and a coach can help clients organize those changes into manageable steps.

Financial coaching can be useful for people who need guidance and structure but do not necessarily need investment management or complex financial planning. Someone with significant assets, tax concerns or retirement planning needs may benefit from working with a financial advisor or tax professional in addition to, or instead of, a financial coach.

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The Difference Between a Financial Coach and a Financial Advisor

In general, you would turn to a financial coach for help saving money and a financial advisor for help investing and growing money. A financial coach works with clients who have few assets and need general financial help. A financial advisor works with clients who need help managing and investing their assets.

An advisor provides options for developing an investment portfolio to build wealth for their clients to meet future financial goals. They typically charge their fees based on a percentage of assets under management, as opposed to coaches who typically charge a flat retainer fee. Advisors often require a minimum asset level to begin service.

Another important difference is that financial coaches are not licensed to provide financial advice like advisors are. Therefore they cannot provide specific product recommendations. Coaches can provide basic advice on the concept of investing, but they cannot recommend how to allocate your assets. They can suggest saving money in a high-interest savings account, but they can’t recommend a particular account.

Coaching also differs from advising in that coaching tends to be a limited-time arrangement, to help the client to achieve financial literacy and learn to manage their finances. Advising, on the other hand, is an ongoing relationship in which the advisor meets with their client once or twice a year and continually manages their financial portfolio for them.

How to Become a Financial Coach

Financial coaching doesn’t require any official licenses, so technically anyone interested can become a financial coach. There is, however, an expectation that a financial coach will have some sort of financial expertise. There are formal training programs available. These include the accredited financial counselor certification through the Association for Financial Counseling and Planning Education.

If you decide you want to help others improve their financial literacy and become a financial coach, there are several steps you must take, starting with the typical self-employment steps. You must form an LLC, get a federal tax ID number, open a business bank account and set up a professional website.

Then you have to decide how you want to run your coaching service. How often do you want to meet with clients, and for how long? How much will you charge? What sort of clients are you looking for, and what expertise do you have to offer? Once you answer these questions, you’ll have the ethos of your practice, and you can begin finding clients. You may decide to work first with friends and neighbors to refine and structure your plan. Then, when you think you’re ready, you can find your first client.

Bottom Line

A financial coach teaching a class on financial literacy.

A financial coach can help you build better money habits, set realistic goals and create a clearer plan for managing your finances. While coaches generally do not provide investment management or specialized tax advice, they can offer education, accountability and practical guidance that may be especially useful for budgeting, saving, debt repayment and other everyday financial decisions.

Tips for Getting Your Finances in Order

A financial advisor can help evaluate your current financial situation and create a financial plan for the future. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Start by taking stock of your current situation. Figure out your total monthly income and monthly expenses and look for areas where you can cut back. Even if it’s far away, ensure you’re putting enough away each month for retirement. That will allow you to save enough to retire comfortably.
Make it a priority to pay off your debts. Consider tackling your high-interest debts first. Once your debts are complete, you can focus on creating an emergency fund. Then you can move on to building an investment portfolio, so your money can grow over time.