Financial coaches usually meet with clients one-on-one, and they can help consumers:
- Determine and define their financial goals.
- Develop concrete plans to meet those goals.
- Provide support over time as they work toward their goals.
The Consumer Financial Protection Bureau talked to people across the country about financial well-being and what it means to them. They said it’s:
- Feeling in control of day-to-day finances.
- Having a safety net to help stop a financial shock from turning into a long-lasting setback.
- Staying on track to meet financial goals while also being able to enjoy life. For some that means taking a vacation, for others it’s about going out to eat, and for others it could mean working less to spend more time with family.
The Urban Institute released a study the CFPB commissioned, which found that financial coaching can help increase financial well-being.
The study analyzed two different coaching programs serving low- and moderate-income consumers:
- Branches, a faith-based social services organization in Miami.
- The Financial Clinic, a New York-based nonprofit helping build the financial security of working-poor Americans.
The study found that coaches can help people achieve financial outcomes that are most relevant to their own situation. On average, people offered access to financial coaching:
- Increased savings by almost $1,200 in New York City.
- Reduced debt by more than $10,000 in Miami.
- Increased credit scores by 21 points in New York City.
- Were more likely to pay bills on time.
- Reported an increased sense of confidence in their finances and reduced feelings of financial stress.
From April 2015 to March 2019, the CFPB financial coaching initiative provided guidance to recently transitioned veterans and economically vulnerable families in places where they already go for assistance.