Author Topic: Financial Coaching - How do I get started?  (Read 2823 times)

NCby2023

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Financial Coaching - How do I get started?
« on: April 02, 2016, 05:05:07 AM »
Hi all -

I have been thinking of starting a small hobby business where I would give one on one budgeting help to local families. I just did a free 30 day money saving tips email program for around 25 people and everyone seemed to benefit from it. I would love to turn this into a side business if I could. I work in Corporate Finance and have an MBA in Finance. I know that doesn't make me fully qualified, but I have a strong financial background and I am passionate about personal finance.

Here are my questions:

1. Do I have any potential liability with this since I am not licensed?
2. Should I have the people sign a waiver? Can I just put something along the lines of "I do not provide tax, legal or investing advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or investing advice. You should consult your own tax, legal and investment advisors before engaging in any transaction."
3. How much should I charge? I was thinking a$100 for 2 hours of one on one help. This would also include a proprietary template and any necessary follow up.

Has anyone else done this?

Thank you in advance to any help you can provide.

Liz

GrowingTheGreen

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Re: Financial Coaching - How do I get started?
« Reply #1 on: April 02, 2016, 08:02:01 AM »
Posting to follow

ender

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Re: Financial Coaching - How do I get started?
« Reply #2 on: April 02, 2016, 08:09:46 AM »
I looked into this a few years ago as someone I know does this sort of thing fulltime.

I was not encouraged from the perspective of doing if formally. Some of the main problems that my friend gave:

  • Lots of consultation time prior to payment generally (not very many people will jump into $100 for a consultation type of thing)
  • Often people who need it the most won't recognize this and/or want to pay for it
  • Minimal recurring revenue
  • Many of the people who need the service often more need marriage/life counseling
  • Business contracts are the best way to get consistent revenue

Doing it as a side hobby is a lot easier since you do not have to worry about finding clients or even supporting your family.

overwhelmed

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Re: Financial Coaching - How do I get started?
« Reply #3 on: April 02, 2016, 10:09:50 AM »

Do you have any 'community/adult schools' around? I have lived in places where the local High School had a catalog of offerings for all kinds of classes for a fee. It might be a way to see what kind of requirements they have, you would potentially get some exposure and begin to make a name for yourself locally & you could even offer a discount for personal coaching for attending the class?

I have no specific knowledge about how you might do this but it might be worth a shot to gauge the level of interest, if after the class people feel as thought you provided value etc.

MDM

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Re: Financial Coaching - How do I get started?
« Reply #4 on: April 02, 2016, 11:07:36 AM »
Probably worth reading https://www.kitces.com/blog/are-the-licensing-and-other-requirements-to-become-a-financial-advisor-too-easy/.

Some quotes from that article:
"Technically, advisors who wish to get paid a fee for their general advice can do so without being registered or regulated at all in most states; however, if the advice pertains to specific investment advice for which the advisor is compensated, it’s necessary to become registered as an investment adviser in any state(s) where the advisor has client(s).  Ultimately, being so registered requires creating a business entity (or formally registering as a sole proprietor business) that will be the “Registered Investment Adviser” (RIA) entity with the state, and the individual becomes an investment adviser representative (IAR) of that company."

"Becoming an IAR of an RIA (whether a new or existing RIA) requires the prospective advisor to complete a 3-hour Series 65 exam, which covers the state laws pertaining to getting paid for investment advice, and similar to other FINRA Series exams has a 72% required grade to pass."


iris lily

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Re: Financial Coaching - How do I get started?
« Reply #5 on: April 03, 2016, 11:41:54 AM »
I looked into this a few years ago as someone I know does this sort of thing fulltime.

I was not encouraged from the perspective of doing if formally. Some of the main problems that my friend gave:

  • Lots of consultation time prior to payment generally (not very many people will jump into $100 for a consultation type of thing)
  • Often people who need it the most won't recognize this and/or want to pay for it
  • Minimal recurring revenue
  • Many of the people who need the service often more need marriage/life counseling
  • Business contracts are the best way to get consistent revenue

Doing it as a side hobby is a lot easier since you do not have to worry about finding clients or even supporting your family.

There was a recent thread on MMM about this exact thing. I was negative about it for the reasons you cite although not as articulate as you.

But there were strong defenders of the idea here. Wonder where that thread is? I still don't see the defenders making any money at this, its not a viable business. If it were, people would be doing it, the Joe Dominguez types who were here long before Pete the Mustachean.

I attended a one night adult,ed course some years ago about mortgage payoff in a few years. It was taught by someone who was excited about the concept of paying off your mortgage. I went just to see what she had to say.
« Last Edit: April 03, 2016, 12:13:35 PM by iris lily »

aFrugalFather

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Re: Financial Coaching - How do I get started?
« Reply #6 on: April 03, 2016, 12:00:54 PM »
You may want to check out the radicalperbsonalfinance podcast if you haven't already. He goes through a lot of strategies for people looking to start financial advising.  Also may want to look into a position with credit counseling services since they offer free services that are paid by credit cards and it is one way to get paid to reach clients that wouldn't normally seek out advice.