I was wrong, part 567

Financial Coaching, WTF?

Yes my friends, for about the millionth time I was wrong about something. One of the nice things about getting older is that this occurrence has stopped being surprising.

Remember that last post? The one where I laid out a moderately specific plan for a friend who asked for money advice? Yeah, it happened again. Now I’ve got another close friend who has relentlessly badgered me to give him some financial coaching. He even offered to pay me, which I absolutely refused.

Hold up.

At this point, I imagine your spidey senses are tingling. If you’re half as cynical and jaded as me, you may be thinking “shit, JSD finally sold out. Here comes the sales pitch for his coaching services. Since it seems like half the big time FIRE peeps have changed course, JSD probably figured it was time to get his” .

Nope.

A wiser guy than me said never say never, and never say always. Sure, there are a few ethical standpoints I’ve committed to, but they are far outnumbered by the less serious stuff that I’m flexible on. So though I’m not going to say I never will monetize this site and leverage it to do whatever(it’s not like that many people read this thing anyways), if I do market something I’ll likely start a different site for that purpose. Rather keep this my anonymous site where I muse about random crap.

That was all a long way to say that no, you have not found yourself at the start of my marketing funnel. I’m actually describing some weird shit that happened, which caused me to change my mind.

Back to my friend asking me for coaching:

I mostly live in my own little world. Abstractly I know that many people are in debt, and a culmination of decades of marketing has made figuring out money an upward slog for just about everyone.

But in my little world none of this makes sense. To me, investing more than half your income seems like an obvious way to stop working for the man, and all of the marketing trying to tell me otherwise sounds like gobbledygook. Maybe it was all of the head injuries, or maybe my personality type has pushed me into this odd minority. Either way, whenever I hear about intelligent, driven people having issues with money, I just can’t fathom it. Does not compute. I then remember some really good training I got back in the dark ages, where I learned that yes, vast amounts of people think in many different ways than me, and this leads to a wildly different outcomes.

That all was playing in my head as I talked with my friend.

He’s another one of those smart, driven types. He has a degree in finance. He can spreadsheet the fuck out of shit, and runs a highly profitable small business. He’s also achieved a lot of other impressive shit, so much so that if I named a couple I’d be doxxing him. But he’s having trouble with money. Nothing crazy, but he knows it could be better and wants a better situation for his family. He would eventually like work to be optional.

For years we’ve talked about investing, and me leaving my job before vesting in our pension made it clear that I sort of had a handle on this money stuff. And he’s been bugging me to coach him ever since.

He laid out his reasons:

1. He’s a high performing athlete and professional. He DIY’d his training and development in both domains, but finally hit a wall. So he sought coaching and training for both, and his results increased dramatically. He figures money stuff is no different.
2. He wants an outside perspective on what he’s doing, because he figures he’s missing something.
3. He’s tried the DIY stuff with money, Dave Ramsey and all that. It worked for a little bit, but then he fell back into old habits. He’s committed to making a change, but doesn’t know where to start.

Even with these reasons, I had a hard time agreeing to help him out. The money stuff seems simple, you can read a few books and be OKish with investing. And if you want further investment advice but don’t want to put in the research, a fee only CFP would probably work. I told him this. But my friend doesn’t want investment advice; he wants help with finding the money to invest, and building the habits so that money earmarked for such doesn’t get eaten by lifestyle creep.

Ah crap, that’s this financial coaching thing I’m allergic to. Remember that post I did about Econome? The one that more than twelve people read? In it I said:

In case you didn’t notice, I bolded the parts where I called out coaching. And now I’ve got a friend asking me to do just that.

Crap.

The good thing is, as I’ve mentioned above, I’ve been wrong about a lot of shit. It’s one of the few constants in my life. Me eating my words is nothing new. I’m firmly aware of what my foot tastes like, having ceasely put it into my mouth.

I think the first thing I can recall being wrong about was sushi. Who the hell would want to eat raw fish? Hell, I don’t even like cooked fish. At least that’s what 17 year old me thought. Then a girl I was dating dragged me to a sushi place (thanks hormones, for overriding my rational brain), and even though I’d spent a month’s pay I was still glad to be wrong about something.

So once again, I decided to hold my nose and chow down on some raw fish. This time it’s meant me taking a deep dive into the financial coaching world via books, podcasts, and blogs. After a few weeks of studying, I’ve now got over 5 pages of notes along with a rough framework of how to approach this coaching crap. And a realization that some of it does have value. Yep, I was wrong again.

To be clear, it has been less than enjoyable trying to get some good information on how to effectively help people change their behavior with money (which is what financial coaching is or whatever). The industry, just like everything else currently on the internet, is crammed full of people building marketing funnels to try and sell you their $3k course. I think some of these people genuinely provide value with the material they are selling. If I ever decide to continue coaching past helping some friends and family, I’ll probably pay for one of the more reputable ones. But man, there sure is a lot of paid stuff out there that seems…….less than optimal. Or to put it nicely, like a fucking rip off.

This seems like a fine line.

I now get that financial coaching has some utility. I didn’t need it to get to FI, likely because I’m in a small subset of the population where pursuing it just made sense and I got lucky along the way.

Meanwhile there’s a fuck ton of people out there who aren’t looking to retire early. But even though these people make a really good income, they’re still living paycheck to paycheck and have a little debt. They’d like to be less stressed about money; they know they should have some to spare given what they’re bringing in, but money is like a foreign language to them. This is my friend who asked me for that plan from last post, this is my other friend asking me for coaching, and looking back, this was a good amount of my old co-workers.

But if you do step into this coaching world, I imagine at some point you’d like to be compensated for all the time you spend doing this crap, especially once you’re helping people outside friends and family. Doubly so when you know these people can afford it and then some. But then comes that line. Yeah, you need to market your services to get paid. But you don’t want to seem all scammy (pay me money to save money? going to need some rebranding on that shit). I could see how this would be a problem. If I actually decide to continue to coach people beyond my personal circle, that will be a big obstacle for me. Lucky for me, that’s a big if. I’ll cross that bridge if I actually enjoy this coaching stuff.

Thanks FIRE

Shoutout to not having a job for giving me the time to go deep on this coaching stuff. Back when I was working I had other people ask me for help. I was busy and fucking tired at the time. So you know what I did?

If they were in debt, I’d throw them Ramsey’s Total Money Makeover at them because:

If they had excess money and didn’t know what to do with it-you guessed it-Simple Path to Wealth time bitches!. Maybe send them a link to Mr. Money Mustache or whatever.

And then I went back to not giving a fuck, as my actual job took priority.

You know how many times that book chucking actually worked?

Actually, it worked once. Friend of mine paid off his house last year and is set to retire in a few years. That was cool. Think the Ramsey stuff just clicked with him.

But there’s almost a dozen friends that I can think of that didn’t change shit after I gave them a book. Or it worked for a few months, then sorta petered out. Sure, some of them probably would not have changed anything even if I had actually done something besides give them a book. Though I can’t help but wonder what would have happened if I’d taken the time to sit down with them and work through their circumstances, and try to help them develop a plan to overcome that shit.

I can’t go back. But now that I don’t have a job, I have the time to give a fuck. So that’s what I’m doing this time.

I’ve got time to figure out how someone builds a desired behavioral change, and how an effective coach can facilitate this. While learning this crap, I also realized:

Coaching worked for me (sorta)

It just wasn’t called coaching.

It was called therapy.

Backing up a bit, obviously there’s some differences between therapy and coaching. Long story short, Therapist help people by facilitating the healing of some issue they’re having, whereas coaches help people improve some part of their lives. Or, here’s a drawing I just whipped up:

If you’re fucked up, therapy helps you get closer to the normal side of the line. If you’re normal, coaching helps you do better than that.

And I was(am?) fucked up.

I don’t blame you if you haven’t read my PTSD posts, it’s long and it drags on. But to sum up the parts relevant to this post, I have PTSD and therapy has helped me get closer to normal.

Being a type A overly macho asshole, I had a hard time getting down with therapy. So years ago I did what I did with this coaching thing before getting into it. I researched the fuck out of therapy.

Having now researched both fields, they appear to have some commonalities. The big one being the method which coaches and therapists use to get people to move in the direction they want is similar. Reputable coaches seem to adapt a Cognitive Behavioral Therapy (CBT) framework in their work, which is the same method my therapist uses. And though I wouldn’t consider myself normal or whatever, I’m sure a hell of a lot better off having gone through that process.

Obviously there are some big differences between the two fields. Therapists are heavily regulated, Coaching is the wild west. But then the consequences are disparate as well, so it kinda makes sense. If a therapist fucks up, people can die. Coach fucks up? You’re out some cash. Sorry you didn’t self actualize or whatevs.

So in acknowledging that I went through something similar to coaching, and admitting that it was helpful, I had to admit to myself that the same framework could help others in different facets of their lives.

Shit.

Which is how I reluctantly found myself telling my friend that I will coach him. I won’t be charging him. He’s doing me a favor too, I get to test out this coaching stuff and see if I like it. If I do, I’ll be asking him for a review and referrals, which sounds like a fair trade.

To be clear, in case you missed it: I was wrong. I look forward to finding other new and exciting things that I’m wrong about. Yay.