'Pro-bono work is effective but also risky'

Wells, a financial adviser turned coach, who is also a fellow of the Personal Finance Society, has had great success with helping people get their finances on track for free.

Nevertheless, he warns for some people getting a coaching service for free can devalue the service and lead to a lesser buy-in into the service.

In a Q&A with FT Adviser in Focus Wells explains the power of financial coaching, when pro-bono work pays off, and why more needs to be done to empower people to take control of their finances, without relying on financial advice.

Where there’s drive and determination to change behaviours, pro-bono coaching can be effective.

FTA: Why do you choose to work as a financial coach rather than adviser or financial planner?

GW: After many years working in the regulated space as an adviser, a trainer and a supervisor, I realised that while traditional financial advice serves a certain demographic very well, much broader support is needed across the UK and beyond.

Most people have not yet accumulated sufficient assets to warrant a financial adviser, yet they need some kind of help with their money. It’s not an ‘advice gap’ but an ‘education, guidance, coaching and planning’ gap.

Let’s call it a ‘financial literacy gap’.

My years working in learning, development and supervision helped me understand that while it’s easy enough to pass on knowledge, getting people to apply that knowledge, develop their skills and change habits is an entirely different ball game.

Care needs to be taken when offering pro-bono work to individuals. There’s a risk it could devalue the service being offered.

I became intrigued with the idea of blending my skills as a trainer with my knowledge as a chartered financial planner.

I wondered how I could help individuals and couples develop the skills to take control of their own finances, particularly where they might not yet be ready for a regulated financial adviser.

After training with Simonne Gnessen at Wise Monkey Financial Coaching back in 2015, I became more aware of the impact that emotions can have around money decisions and habits.

It’s this blend of practical and emotional work that makes financial coaching so fulfilling. I think my natural stance is to empower others to manage their own money, rather than for them to rely upon me as an adviser.

FTA: What’s your target demographic?

GW: I mostly work with individuals and couples in their 40s and 50s. I love working with those in mid-career who are beginning to weigh up their options, want to make the most of their time and plan for a fulfilling future.

FTA: How much of your work is pro-bono or discounted?

GW: Part of my pro-bono work is to help provide financial education in local schools.

This averages out at something like a half-day per month over the course of a year. I’ve also completed around 30 pro-bono coaching sessions with individual clients since starting my business, which is just under 10 per cent of my overall activity.

I’ve also partnered up with a charitable organisation, which provides support to survivors of childhood abuse.

This is particularly important given the emotional aspect of the work and the overwhelm that can often be experienced upon receipt of redress by survivors.

This type of work is generally completed at a discount, taking into account the coaching time and preparation required.

FTA: Who is your pro-bono work targeted towards/how do you pick ‘worthy’ causes?

GW: Some potential clients who get in touch show a real determination to learn and develop new habits and skills, but are currently in a challenging financial situation and fees for coaching might put further strain on their finances.

In these cases, even just a couple of pro-bono sessions can make a big difference and free up cash.

For example, one client was able to reduce their monthly outgoings by more than £500 by developing more intentional spending habits.

So where there’s drive and determination to change behaviours, pro-bono coaching can be effective.

Others, who may be really struggling financially, could be better served by charitable organisations like StepChange and the Citizens Advice Bureau.

I think care needs to be taken when offering pro-bono work to individuals. There’s a risk it could devalue the service being offered and on occasion there simply isn’t the same buy-in if a financial commitment has not been made.

FTA: Why is pro-bono work nevertheless important to you?

GW: I feel that everyone should have the opportunity to learn about money and financial planning, regardless of their financial circumstances.

Importantly, knowledge in itself is not enough. It’s our relationship with money, our habits and our attitudes that will largely determine our financial future.

That applies to everyone, regardless of demographic or financial status right now, so pro-bono work can help bridge the financial literacy gap.

In my early days as a coach, it was also a great help for gaining experience and testing different ways of working.

Each client is uniquely different and pro-bono work helped me accelerate my learning.

FTA: What do you get in return?

GW: Commercially speaking, my best example is from working with one individual on a pro-bono basis, who then recommended my services to five different paying clients.

In general, it can really help spread the word on the value you bring as a financial professional and if pro-bono clients become true advocates, then it pays dividends.

That, of course, is on top of the general feeling of making a worthwhile contribution.

Once of my favourite anecdotes from this year is when my wife and I bumped into a student who attended some of my financial education sessions in the local high school.

She told me, with great enthusiasm, that since leaving school she has completely changed her financial outlook, negotiated a pay rise and is now saving hard for her first home.

More needs to be done about the empowerment of people to take control of their finances, without relying on ‘advice’.

Of course, when you’re speaking in front of 40 young people in school, you have no real sense of whether you’re making a difference, so this was lovely to hear.

A couple of weeks later, her father approached me at a local beer festival and apologised for his daughter ‘hounding me’ and went on to explain the open and honest conversations about money they’ve been having as a family.

You just never know the reach that pro-bono work can have.

FTA: What do you make of the industry’s attitude towards giving back?

GW: There’s a lot of great work going on and a huge effort going into financial education of both young people and adults.

It’s also great to see voluntary support within the financial services profession itself.

Many experienced financial planners will help support newer entrants in their professional organisations, like the PFS, where I’m also registered as a mentor.

There are also some tremendous free resources available to the public, like Pete Matthew’s Meaningful Money project.

FTA: And yet, where do you see room for improvement?

GW: It’s a tricky one, but more needs to be done about the empowerment of people to take control of their finances, without relying on ‘advice’.

Self-determination and financial confidence must surely be the biggest prize for those who don’t want or need to devolve responsibility to a regulated adviser.

The industry needs to develop more choice for the way in which people plan their financial futures, but rather awkwardly, this might not necessarily require the recommendation of products or assets under management.

It’s work in progress and to some extent will be affected by the advice and guidance review by the Financial Conduct Authority and the Treasury.

Let’s hope the outcome will accelerate progress and not hamper it.

carmen.reichman@ft.com