How to Be Your Own Financial Coach
A coach is someone who helps us create goals, overcome setbacks, and break through the barriers holding us back from those goals. They hold us accountable and are our biggest cheerleaders. Every time I’ve hired a coach for a specific goal, I immediately feel excited and more confident that I will actually achieve the goals I set out to accomplish.
A good financial coach is no different. A financial coach should help us get clear on what’s important to us, set goals that are aligned with our values, and then help us get there. They ask good questions. They create a judgment-free zone. They help us keep going when we fail or make mistakes.
Hiring a financial coach is often a significant financial investment. For some, the investment ends up being a very positive thing because when we pay for something, we’re invested. We show up. We put in the time.
But that same investment makes financial coaching completely inaccessible for most others. It’s expensive. I wish I could offer my financial coaching services for less but there are only so many hours in a day. In order to dedicate one-on-one time to an individual, I have to charge a certain amount.
But there’s good news. I have been working as a financial coach for eight years (where does the time go?!). I know what makes a good financial coach and there are many things we can do to be our financial coaches.
Here are six steps to be your own financial coach so you can start seeing real results toward your money goals.
1. Set aside time.
This might sound obvious or silly, but one of the reasons my clients have so much success is that they are actually setting aside the time to deal with their money. It’s really easy to let our finances sit on the back-burner. We’re busy and other things come up, so we continue to put them off. Then they hang over our heads and stress us out. Not fun.
When you have time booked in the calendar (especially time you paid for!), you are going to show up. Carving out time to deal with your money makes it so you can rest assured the things you plan to do get done. Set up a recurring calendar reminder for every two weeks to meet with your financial coach (aka yourself). I call these Money Parties!
If you need some financial incentive, build it in for yourself. Transfer money to a friend if you skip out on your money meeting with yourself.
2. Set concrete goals.
Another thing we tend to do is set wishy washy goals. We say things like “ugh, I need to save more” or “I’m spending way too much on [insert thing here].” Vague goals aren’t motivating and it’s unclear how we will even accomplish them.
As your own financial coach, you will want to create some SMART goals. SMART goals are specific, measurable, attainable, relevant, and time-bound. These goals should be exciting to you and motivate you to make some money moves.
When we’re clear on our goals, especially if they are goals we are really excited about, our money mindset makes an important shift. Instead of seeing dealing with our money as this restricting or limiting thing, we start to realize that it’s a radical act of self love. Why? Because we are giving ourselves what we want most - our goals.
Now, just because these goals are exciting doesn’t mean they have to be huge. For some of us, saving five dollars per week would be a tremendous win. For others, having a plan for the first time would be something to celebrate. We don’t have to progress by leaps and bounds in order to improve our financial well-being. And honestly, when we try to do that, we’re usually not as successful as we are when we take smaller steps.
3. Look at the big picture and create plans to reach those goals.
Once we’re clear on our goals, it’s time to make a plan. This is where budgeting comes in. When we have a good financial coach (and believe me, you do!), your budget should be both realistic and optimistic.
You want to be making headway on your goals but don’t want to create a plan that’s such a stretch that you feel like you’re constantly failing or falling short. Putting together a realistic budget starts with reality. Take a look at your spending and earning over the last few months.
Use the past to create your estimates for the next twelve months. Using the past as a gauge doesn’t mean your future can’t look different. It’s just important to use reality as a starting point.
Once you have the next twelve months laid out, you can see if it’s workable. If it’s not, that’s okay. We have to know where we stand before we can do something about it.
4. Take time to reflect (Take time to reflect)
A good financial coach will encourage you to take time to reflect - something that’s important to our success but often overlooked. We’re always on the move, and we don’t stop to evaluate and see how we can improve. This is a missed opportunity and often where most of our progress is.
Let’s say you put together your plan and it includes spending a certain amount on takeout each week. You blow past that number. That’s okay - this is where the magic happens. It’s important to stop, take a step back, and reflect on why that happened. Was the spending goal not realistic? Did you end up ordering when you were starving at the last minute because you had no groceries?
This is a great time for you to play detective as your own financial coach. Try to take the emotion out of it (I know that’s hard). If you need to be upset, give yourself a time limit to get it out of your system. Then, come back to the situation as if you were an outsider looking in. What happened here? What can you try to set yourself up for more success next time?
That might mean preparing meals ahead of time, pre-planning days of the week you order takeout, or deleting the takeout app from your phone. Try something or a couple things and see what works.
5. Create accountability
When you are your own financial coach, you may want to bring in some outside accountability as reinforcements. Just like having a gym buddy makes it more likely (and more fun) that we go to the gym, a money buddy makes it more likely we follow through with our money goals.
You can share your goals with your money buddy and which actions you are taking to get there. Ask them to hold you accountable where you know you’ll need the support.
6. Be your own cheerleader. Be kind and compassionate with yourself.
We can be really hard on ourselves when it comes to our money. Have you ever noticed the things you tell yourself? Sometimes we’re outright cruel! If you’re your own financial coach, you also need to be your own cheerleader.
You will make mistakes and get off track. I’ve been doing this a while now and it still happens to me all the time. Yes, it’s frustrating, but each of these missteps are learning opportunities. If you can cultivate a growth mindset around your money and understand that your financial prowess can and will improve over time, you’ll be more likely to succeed and have an easier time being kind to yourself along the way.
You are now ready to be your own financial coach. A money journey is an iterative process. Repeat and revisit these six steps each time you have a money meeting with yourself and you’ll make some major headway towards your money goals.