What’s the difference between a financial coach and a finfluencer?

We’ve all seen people on Instagram living lavish lifestyles, buying expensive cars and generally enjoying the good life. They’re willing to tell you how to get rich, and how to do it quickly. So, where do you sign up?

Well, first take a minute to think about whether everything is really all as it seems. Financial influencers (finfluencers) often present a glamorous persona, but like those folks who pose in front of someone’s else’s Ferrari, much of it is based on fantasy.

If someone is telling you how to achieve their lifestyle, and it sounds too easy or quick, then it probably is. And while they might mean well, they may also be lacking in the financial background or qualification to give sound guidance.

A certified financial coach, on the other hand, will approach things a little differently. They’ll have a strong financial background and knowledge, and will give you guidance based on your needs and goals. They’ll look into your unique financial situation, and help you build a plan to get where you want to go.

You should expect a coach to speak to you about your financial situation in terms that are relatable, realistic and actually reflect your circumstances.

YouTube holes

Not all finfluencers are selling a pipedream of easy money and beach parties. Some offer respectable financial tips on how to budget and save for the future.

So, what’s the difference between these influencers and a financial coach?

Both may be doing similar things: helping you work out your financial goals, understand the benefits of savings, clearing debt and building a plan for the future.

The key difference is that a coach will guide you as you apply those principles in your own life. It’s a bit like watching a YouTube workout video compared to getting a personal trainer. In both cases you still have to do the work to get in shape. But the personal trainer develops a plan with you and makes sure you turn it into action, while the workout video offers only inspiration and handy hints.

A financial coach will get you out of the YouTube hole and into practical money planning.

A two-way street

Another way to think about the differences is that your relationship with a finfluencer is generally one-way. You follow them, read or watch their content, and maybe speak to them in the comments.

They’re mainly broadcasting at you, rather than holding a dialogue with you.

A financial coach will be focussed on building a two-way conversation.

Although you might first come across your financial coach on social media, your relationship with them will eventually move into a one to one conversation. By gathering information about your financial circumstances, who you are and what motivates your money goals they develop financial guidance for you, not just for anyone.

The end of the road

Another way to think about the difference between a financial coach and a finfluencer is to ask what’s at the end of the journey they’re guiding you through.

Finfluencers are content creators that can help you learn about money. But the journey tends to end there. Read, watch, repeat.

For a financial coach, education will just be the start of the journey.

Videos, articles and posts tend to be a gateway to financial education but they are just the first step. Your coach will work with you to budget, develop your financial goals and a plan to realise them, which could end with investing to grow your money for the future.

Show me the money

Lastly, and perhaps most important of all, a financial coach will charge you a fee. Why is this a good thing? Because coaches make their money from fees, they’re completely independent and don’t have an agenda to sell you anything. It also means you’re paying for a level of support that you won’t get from a finfluencer - you’re a client, not just a ‘follower’.

In contrast, finfluencers will normally make money through paid posts and affiliate partnerships with brands, or through ad revenues if their videos get enough views. Their focus is more likely to be on growing their following and getting as many eyeballs as possible on their posts.

This article is supported by Claro, a financial coaching provider - more information on our financial coaching pages.