When it comes to getting your $hit together, one of my biggest pieces of advice is to enlist the help and support of someone (or some many) you trust. Who you need to work with comes down to your wants and needs. If money is a concern, there are people (like me!) who are dedicated to helping other people have a better experience with their finances. But what’s the difference between a money coach and financial advisor, and who do you need? It depends on what you’re looking for, and you may even benefit from having both in your life. Is a money coach the same as a financial advisor, and vice-versa? Nope! Let’s break down some of the differences so you can understand what to expect from each professional.
While both money coaches and financial advisors are hired to help you build a better financial life, each one has its own set of characteristics that make them two entirely different approaches to money management. One is not necessarily better than the other…it’s all about what they can do for your specific needs.
Here’s the scoop on money coaches
A money coach is someone who can support you and/or your family with making financial decisions as well as someone who can support you with developing a healthy money mindset. It’s a collaborative effort with your needs and goals at the center. A money coach is going to dig deep into what you’re really looking to accomplish. Your money coach can help you make the financial decisions that are best for you, and help you work through how to achieve those big financial goals one step at a time. They’re especially helpful for people who are at the beginning of their money management journey because money coaches provide education, motivation, and basic tools to help you succeed. They’ll help you get there, but it’s up to you to follow through and make it happen.
If fear or lack of understanding stops you from making smart money moves, a money coach is for you. If shame or regret has been holding you back, my way of working with my clients is to stop the shame and guilt cycle. I’ve been where you are, and no matter how bad it seems, it is my job to help you walk through the fire and be intentional in your money journey.
A good money coach comes with education and motivation. For example, helping you find the best way to pay off credit card debt, or teaching you how to renegotiate interest rates with your lenders in order to save thousands of dollars over time. The job of a money coach is to help you fill in the financial gaps in your life, without the guilt or shame, so you can intentionally increase your income.
What a financial advisor can do for you
A financial advisor, on the other hand, is a licensed professional who is primarily focused on your investment portfolio and presenting you with an array of options and products. You will need to bring knowledge of your financial story and your numbers to the table when you work with a financial advisor. Fees and product-based commissions can come into play as well, so interviewing a potential financial advisor means that you have to find someone that you can trust to have your best interests in mind. They’ll be watching your investments, and you’ll want to make sure you have a full understanding of what your investments are doing, too. Which means knowing what you’re doing going in is key.
In 2022, only 35 percent of Americans worked with a financial advisor – and nearly half of consumers think financial advisors are more expensive than they actually are. If cost is an issue, recent surveys show that almost everyone who uses an advisor says they are worth the money. If you’ve been holding back because of costs, you might be surprised to know that it’s not as overwhelming as you might think. However, the key with financial advisors is to be ready to invest money on a monthly basis, and you want to be financially ready to do that before working with one.
I have great relationships with financial advisors, and it’s my ultimate goal as a money coach to make my clients great clients for financial advisors. The truth is, not everyone is ready to invest or establish a relationship with a financial advisor. If you want or feel like you need support with managing cash flow, setting goals, and overall just need someone to hold you accountable, a money coach might be a great place to start.
The bottom line on a money coach and financial advisor: Hire someone who will help with YOUR finances
No matter who you bring onto your team to help you build the financial future that you want, the most important thing to keep in mind is that you are in charge of your money. Getting clear on your specific goals can help you get a good grasp on the best path there. You’re not alone, either! Being inspired and uplifted by others who totally get it can really help take off the pressure. If you’re looking for a supportive group of women to help you take confident steps in your financial journey, join mine. If you need help getting your $hit together in a way that works for YOU, sign up for my next GIT Elevated Money Course today!