Financial Coaching: A|4 Framework and Application of Coaching Models

February 18, 2015 12pm-1pm CST

Brought to you by: Center for Financial Security

at the University of Wisconsin- Madison

Our Presenters

Peggy Olive Financial Capability Specialist University of Wisconsin-Extension/Madison

Becky Smith Director of Strategic Initiatives The Financial Clinic

Stefan Hench Assistant Director of Services The Financial Clinic

Financial Coaching: Frameworks & A|4

Model Peggy Olive, MSW, PLCC

Financial Capability Specialist University of Wisconsin-

Extension/Madison

Financial Coaching Fundamentals • Relationship-based goal attainment

• Collaborative, egalitarian, respectful • Facilitate self-directed learning

• Client identifies areas to work on • Coach focuses on the person, not the

problem • Increase positive and lasting behaviors

• Open bank account • Make budget and stick to it for 2 pay

periods • Fund savings accounts

Financial Coaching Influences

• Executive/organizational coaching • Behavioral economics • Positive psychology • Plus additional fields – self-determination

theory, solution-focused therapy, motivational interviewing, adult learning theories, health coaching, etc.

Coaching Frameworks • Provide a model for facilitation • Different frameworks emphasize

different philosophies and techniques

• Also similarities across frameworks coaching = results

Resource: Evidence Based Coaching Handbook. Stober & Grant, Eds. (2006)

Prevalent Frameworks

• Solution-Focused Coaching • GROW Model • Goal-Focused Coaching

• Cognitive Coaching • Motivational Interviewing

GROW Model (Whitmore) G = Goals – long and short term R = Reality – explore the current state O = Options – courses of action W = What actions will take place & when • Client self-responsibility ≠ accountability

• Coach is facilitator ≠ teacher, advisor, instructor

Goal-Focused Coaching (Grant)

• Coach facilitates process in which client: • Sets a goal • Develops an action plan • Monitors results • Evaluates/adjusts future actions

• 20 different types of goals (performance, avoidance, learning, etc.)

Cognitive Coaching

• Coach identifies and challenges client’s self-limiting beliefs

• Change thought patterns = change behavior

• Examples: • Should/Shouldn’t • Facts vs. Opinions

Motivational Interviewing

• Not a coaching method per se • Linguistic approach to behavior

change • Counseling addictive behaviors

and health/wellness coaching • Similar skills as coaching BUT skills

are applied differently

A|4 Financial Coaching Process

Designing the Alliance

Client Coach

Alliance

• Logistics – timeline, meeting schedule, check-ins

• Discuss how to work together – coaching vs. counseling, education, referrals

• Plan ahead for sticky situations and closure • Accountability to Alliance (not to coach) • Tools: Coaching agreement, contract,

contact info • Skills: Listening, clearing, validating,

celebrating

Designing the Alliance

• Coach: Goals and requirements of program

• Client: Bring goals for each meeting Big A / little A

• Tools: Assessments, prioritizing, planning worksheets

• Skills: Clarifying, articulating, reframing, self-management

Setting the Agenda

Creating Awareness

• Tools: Values worksheets Future self/visioning Different perspectives

• Skills: Powerful questioning, curiosity, validating, acknowledging, holding the client’s agenda

• Given the client’s new insight, what will they do next?

• Accountability to the Alliance, not to the coach

• Tools: Goal log, structures, technology, financial information, homework

• Skills: Brainstorming, requesting, challenging

Defining the Action

Additional Coaching Considerations

• Client readiness • Coach qualities • Coaching training • Evaluation

fyi.uwex.edu/financialcoaching

Building Financial Security, Improving Financial Mobility

The Financial Clinic

The Financial Clinic’s Model

Change Machine Platform

Applications of the Clinic’s Model

1 US Department of Labor Bureau of Labor’s Occupational Outlook Handbook

Financial Coaching Program

15 Coaching Sites in Manhattan, Brooklyn, Queens, and Bronx

6 Financial Coaches

Funded by NYC Office of Financial Empowerment, Robin Hood, and others.

Managed from Clinic HQ near Herald Square.

Career Advancement Program

Employment Services

Financial Development

Greater Impact

Challenge: Financial insecurity can create obstacles for job seekers

Opportunity: Financial coaching tools and strategies can remove barriers

Results: Greater efficiency, effectiveness, mission achievement

The Financial Clinic’s “Mantras”

Our financial coaching

mantras are short phrases

that embody our coaching

practices that make

change happen.

Clinic Coaching Mantra #1

“Goal is the Driver”

Goal is the Driver

Example: Financial Coaching Program

Loss Leaders •Crisis (ie. Tax notice,

debt collector calling) • Life moment (tax

filing, graduation)

Financial Coaching

Customer Goal + Financial Security

Example: Career Advancement Program

• Set employment and financial goals GOALS

• Establish a place to deposit and save wages BANKING

• Prepare for pre-employment credit checks CREDIT

Clinic Coaching Mantra #2

“Action Plan Answers All”

Action Plan Answers All

Example: Career Advancement Program

More than 2,200 job seekers

served

Over 2,160 credit

reports downloaded

More than 670 bank accounts opened

Over 325 established

direct deposit

Signed up more than

530 for automatic

savings

Example: Financial Coaching Program Financial Security Outcomes (from Change Machine)

Assets: 123 customers established regular contributions to savings, with an

average increase of $1063.

Banking: 40 customers reduced banking fees an average of $179 per year. Credit: 250 customers increased credit scores by an average of 39 points.

Debt: 341 customers reduced their debt by an average of $2159. Taxes: On average, customers save 21% of their refund (for those saving a

portion of the refund). …. All driven by customers’ Goals!

Clinic Coaching Mantra #3

“Saving is an activity, not an

amount”

Example: Financial Coaching Program

Example: Career Advancement Program

31% increase weekly

earnings

Establish Auto-Savings

The Financial Clinic

Keys to Success

Outcomes Framework Made Easy

Consistent Customer Engagement Tools

Real-Time Data For Real-Time Insights

Ongoing Professional Development

Access to a Community of Practitioners

Thank You for Joining!

Contact us with questions: Becky Smith: rsmith@thefinancialclinic.org Stefan Hench: shench@thefinancialclinic.org

Upcoming Events: www.change-machine.org/events New Ground Symposium: Tuesday, February 24 at 1pm ET Introduction to Change Machine: Tuesday, March 10 at 3pm ET

Q &A

Peggy Olive Financial Capability Specialist University of Wisconsin-Extension/Madison

Becky Smith Director of Strategic Initiatives The Financial Clinic

Stefan Hench Assistant Director of Services The Financial Clinic

Please join the Center for Financial Security on March 17th for our next webinar on:

Emergency Savings

www.cfs.wisc.edu/ Please contact Hallie Lienhardt

hallie.lienhardt@wisc.edu or 608-890-0229 with questions.