The Role of Coaching in Personal Finances
29th January 2014THE ROLE OF COACHING IN PERSONAL FINANCES
I was asked during one of our programmes to talk about how a Simply Changing Developing Coach could Coach a person if the outcome is personal finances. These outline guidance notes provide some clarity and were discussed at that group's webinar.
A Little Background To Provide Context
The financial industry is highly regulated by the Financial Services Authority. The FSA closely scrutinise financial products which are sold to individuals.
Financial advisors study and then sit exams which gives them varying degrees of licence. Some are restricted to limited financial advice/services/products and other are licensed to offer a full range of services and products.
Often on the news you will hear of services and packages that have been mis sold and there is often compensation for individuals who claim.
What happens if the Coachee thinks we’ve advised them?
As a Coach, our responsibility is to Coach people towards their goals. Of course, often finances are personal goals because people often want to gain more control over their finances.
So how does our role as a Coach fit with this?
We are not trained to consult or advise. Sometimes when we Coach, a Coachee can say to us ‘you told me to………….’, even when you engaged with pure coaching. So, what happens if you engaged with pure coaching and the coachee has the ‘perception’ that you ‘advised’ them and on the back of that advice they sold their house or took an endowment mortgage, or invest in a fund etc.
There is a possibility that you could be embroiled in something that might require you to access your professional indemnity insurance.
So, here’s some good basic advice on how to Coach when financial goals are involved:
As a coach here is the scope of our involvement in Finances if the goal involves making a decision about a financial product or service
Refer them onto an IFA (Independent Financial Advisor)
What if there financial goal is to save more (or similar) and does not involve a financial product or service
If the financial goal is about something like saving more, spending less, getting a better paid job, saving for a holiday etc, then in keeping with good coaching practice it’s advisable to:
Keep to pure coaching
Identify in written form the financial goal
Explain the role you will perform (and place this in your agreement form for this Coachee)
Ensure you write bullet point factual notes of what actions the Coach identified for themselves
Please note: These notes have been designed specifically for the Simply Changing Coaches who know they have access to me professional supervision and can chat to us about how they impact on their coaching.
Louise
