Financial Coaching

Financial coaching is an emerging form of coaching that focuses on helping clients overcome their struggle to attain specific financial goals and aspirations they have set for themselves. At its most basic, financial coaching is a one-on-one relationship in which the coach works to provide encouragement and support aimed at facilitating attainment of the client's financial plans. Recognizing the array of challenges inherent in behavior change, including all too human tendencies to procrastinate and overemphasize short-term gains over long-term wellbeing, they monitor their clients’ progress over time and hold the client accountable. This monitoring function is hypothesized to boost clients’ self-control and willpower.

Previous studies in psychology indicate that individuals are much more likely to follow through on tasks when they are monitored by others, rather than when they attempt to ‘self-monitor’. Although early research links financial coaching to improvements in client outcomes, much more rigorous analysis is necessary before any causal linkages can be established. In contrast to financial counselors and educators, financial coaches do not need to be experts in personal finance because they do not focus on providing financial advice or information to clients.