In our recent poll of "Do you know the difference between a Financial Coach and a Financial Advisor?" only 15% of the respondents knew the difference while 85% did not. We have put together the below information to help you understand better.

What Is a Financial Coach?

A financial coach is someone who will help you understand the basics of personal finance and help you develop and maintain healthy financial habits. The job is to empower you to reach your financial goals and learn how to handle your finances responsibly.

Just like a coach for a sports team, a financial coach teaches you the knowledge and skills you need to play the game, helps you create healthy habits that improve your performance and then encourages you from the sidelines.

A good coach provides the “big picture” overview of money, investing, and wealth building. They help with budgeting, saving, and tax-reduction strategies as well as investing strategies. They help guide you up the investing mountain towards your investing goals. They provide a clear step-by-step roadmap that teaches you all the investing options available.

A coach helps them to move past any “mental blocks” that are holding you back from financial abundance and get you to start out on the right path. They work with you to overcome your fear of investing.

The coaching process is really about education and building confidence so that you can reach your financial goals. Whether your goal is to save for retirement or create more income, the end result is teaching you to become independent and empowered to make your own decisions.

An investing/ wealth coach does not manage your money. Their job is to help you to create your wealth in the first place. They focus on your financial education and help you build the skills necessary to understand investing and wealth building and to make informed investing decisions.

At PaceUP Invest™, we offer coaching service to our clients both personalised and in groups.

What Is a Financial Advisor?

A financial advisor is someone who helps you build wealth and prepare for your future through long-term financial planning. While they can advise in all facets of personal finance, they tend to focus on comprehensive financial goals that last throughout your lifetime and beyond. They usually work with clients who want to manage their assets, build an investment portfolio, and plan for their retirement. A financial advisor also helps with taxes, estate planning, health care and long-term care planning.

Financial advisors are licensed to sell securities and financial products and provide specific investment advice that is tailored to your financial situation, risk tolerance and constraints. They are also licensed to make investments on your behalf.

If you decide to work with a financial advisor, make sure you find someone with the following:

  • Fiduciary responsibilities, meaning they look after your interest first.

  • Ideally, their only compensation is a fee based on assets under management, or with smaller accounts, on a set-fee basis..

  • They should be a truly independent finance professional.

  • Your money is held by a reputable third-party custodian, not the advisor.

PaceUP Invest™ advisors are CFA charterholders and meet the requirements and more above. Contact us today.

In a nutshell:

  • A financial advisor manages the money you’ve already saved.

  • An investing/financial coach helps you to create your wealth in the first place.