Financial Planning and Financial Coaching are both invaluable services for clients, but there is a distinct difference between the two.
Financial Planning involves developing a strategy that puts the client in a position to reach their financial goals. Financial Coaching is all about teaching clients how to manage their finances on their own.
Glad we’re all on the same page, but the question is, what’s the benefit of doing both?
By providing both services, you will be able to better meet your client’s needs while increasing your own marketability. Your clients will benefit from having access to both services, as they can get the strategic advice they need while also learning how to make better decisions and build strong habits.
Don’t just take it from us! On a recent episode of the Financial Planner Life Podcast, we spoke with Pete Matthew, Chartered Financial Planner and Founder of the Meaningful Money YouTube Channel, which is aimed at making Financial Services knowledge more accessible to those outside of the industry.
Pete’s informative content offers both Financial Coaching insights to audiences looking to improve their knowledge and become more financially aware, whilst also breaking down barriers around what a Financial Planner can do for your wealth long-term.
Pete told us:
“I think Financial Planners need to become better coaches, it’s a separate discipline but they obviously speak to each other. A really good Financial Planner will be doing elements of coaching anyway, but I think it’s more than that, I think it’s worth learning how to coach people.”
On the surface, offering this service to individuals who don’t fit the mould of typical clients, might seem like a less valuable use of your time as a Financial Planner, however, what you’re doing is planting the seeds of trust for future engagement with this audience demographic.
But here’s the kicker – Clients who have benefited from your Financial Coaching services are likely to become repeat customers or referrals if they see real progress made in their personal finances as a result of working with you!
Pete said during our conversation:
“In August 2011 I had an email.. there was a single line at the end that just said Pete, we’ve watched several of your videos, and we feel like we know you and can trust you, will you work with us as clients?”
Remember, Pete’s page focuses on providing Financial Coaching style tips on personal finance, as well insight into Financial Planning for your average person, yet this ‘giving back’ element of his work has positioned him as a trusted source of knowledge in the Financial Services space.
“People that don’t have the regulated qualifications can build brilliant businesses and do an awful lot of good to lots of people just by being Financial Coaches, it’s a totally different skill! I think this next decade will be the decade of Financial Coaches and I’m really, really excited by that.”
But what skills, as an adviser, might need to develop to become a better Financial Coach? Well, let’s consider the difference in client demographic. Those requiring Financial Coaching are likely to be in a less advantageous position financially than someone looking to invest their wealth, therefore, they’re likely to be less comfortable talking about money.
There’s a current media trend of banks and Financial Services firms encouraging people to be more comfortable talking about money and take action toward bettering their financial future, adding to a largely unexplored client group that could benefit from a Financial Coach.
“If it’s true that the biggest factor in your financial success is your behaviour and the way you act toward your money… then it’s coaching that is going to have the biggest influence, so I think the best Financial Planners are coaches as well.“
So there you have it, offering both Financial Planning and Coaching services can drastically improve the quality of service that you provide to your clients. Not only will they benefit from the comprehensive approach that you offer, but it can also give you a competitive advantage in your field as well as greater insight into what drives them to reach their financial goals. For these reasons, offering both services is an invaluable asset for any Financial Planner looking to maximize their client’s satisfaction and increase their own marketability.
“I’m so excited about the future of Financial Coaching… I think that’s the answer to the advice gap… we are no longer brokers of product and haven’t been for a long time.”
This is just a sample of the incredible knowledge shared by Pete Matthew on the Financial Planner Life podcast, check out the full episode using the link below: