What's the difference between financial coaching and financial planning?

Let's start with what a financial coach does:

A financial coach generally works with people on the foundations for financial success, starting with your financial mindset and financial literacy.

Financial coaches focus on behavior change and helping you develop good financial habits. Then financial coaches work with you on your budgeting/cash flow, debt management, saving, and basic financial education.

Financial coaches definitely do not (or at least, should not) provide specific investment advice. An example of this would be a financial coach saying something like "You should invest in Apple stock" or "You should invest in crypto."

Financial coaches usually charge either by the session or sell coaching packages. Financial coaches also typically work with clients less than a year (usually 1-6 months at a time).

Financial coaches usually focus on the lower part of this Pyramid of Financial Awesomeness, from The Hell Yeah Group.

Now, what does a financial planner do?

A financial advisor or financial planner generally works with people who have good cash flow already. This means that they already know how to budget and save money, and usually do not have a lot of high interest debt like credit card debt or personal loans.

Financial advisors should provide comprehensive recommendations on your entire financial life, including insurance, investing, retirement, workplace benefits, tax planning, estate planning, education planning, and so on.

Financial advisors have many different ways they charge their fees.

The most straight forward are direct fees where you pay via ACH or credit card and an investment management fee (AUM fee).

An investment management fee (or assets under management fee) is where an advisor charges you a percentage of the total amount of investments they are managing for you.

Financial planners usually cover all of the topics below - image credit to Sustain Financial Inc.

Where can I find a financial coach?

Gabbi is a financial coach, but I might not be the best fit for you - if you want, you can schedule a free 30-min call to talk with me above (top right corner button) and I can point you in the right direction (whether that's working with me, reading a book, or finding someone else to work with).

→ A good place to start is the Accredited Financial Counselor's 'Find an AFC' website - https://findanafc.org/

Where can I find a financial planner?

There are a few good places to start looking for a financial planner:

→ Find a CERTIFIED FINANCIAL PLANNER™ - https://www.letsmakeaplan.org/

→ Find a fee-only, fiduciary financial planner by location - https://www.napfa.org/

→ Find a fee-only financial planner by specialty - https://connect.xyplanningnetwork.com/find-an-advisor

Gabbi is a CERTIFIED FINANCIAL PLANNER™ who works at Sustain Financial Inc, where she provides comprehensive financial planning to teachers and government employees. Please note that Sustain Financial Inc. is an unaffiliated Registered Investment Advisory. It's funny that I have multiple scheduling links, but if you're more interested in financial planning, schedule a call here!