View from the Trenches: Lessons Learned from Years of Financial Coaching

financial coaching

I’ve been doing financial coaching for a few years, and the lack of financial education in America continues to amaze me.

Studies performed every few years consistently show that approximately 80% of Americans live paycheck to paycheck, regardless of income level. 

Fights about money and financial struggles are the leading cause of divorce in the United States.  It’s one of the top stressors at work.  It’s a leading cause of suicide and a significant motivating factor for committing crimes.  

When physicians meet with patients who present with particular symptoms, we are able to recognize patterns that lead to a predictable and treatable diagnosis.  This approach leads us to a strategy for healing and recovery from health concerns. 

Over many years of financial coaching, I have observed that people tend to make mistakes in syndromic ways with their finances as well.  

Here are the top five mistakes that plague American families that they must overcome in order to start moving their finances in the right direction.

1. Believing that math is the problem and therefore the solution

As health care professionals, we often want to approach financial situations by looking for a mathematical or scientific solution.  

We start looking for ways to pick up extra 0.25% points of interest, or we look for 0% interest loans, or we talk about consolidating student loans like it’s the answer to our problems.  In other words, we are often looking for a sophisticated means to achieve our financial goals.  

What I’ve learned through reading many financial books and coaching families who successfully become debt-free and start building wealth is that the secrets of the wealthy are not really secrets. 

There’s nothing fancy or sophisticated about building wealth.  

The secret is that math isn’t the problem!  The problem is one of behavior.  

Getting on solid financial footing begins with acknowledging that your current situation is a direct result of the experiences and choices that led you to that point.  If you want a different result, you have to make different choices. 

If you keep looking for a unique way to get out of debt and build wealth, you’re going to be disappointed.  

The average millionaire is incredibly unsophisticated in their approach to finances.  Very few of them scored big on the stock market in one big pick, or managed to ride the “Bitcoin wave” early on, or invented some major piece of technology that launched them. 

They learned early on to work hard, make a decent income, save well, and live beneath their means, which brings us to the second point and probably the problem I see most often tormenting families who struggle with their finances.  

2. Failure to live within your means

I often have patients with significant obesity problems ask me how to lose weight.  My answer is always the same, “Eat less and exercise more.”  There’s no magic to it.  No safe, magic weight loss pill exists. 

There’s no easy fix.  It’s the same way with money. 

You make a certain amount of money.  If you spend exactly everything you make, you have no money left over.  When you spend less than that, you have money left over to save.  If you spend more, you go into debt.  It really is that simple.  

It is SO easy to spend a ton of money in America today.

Online shopping, “1-click ordering,” automatic subscription services, and readily available credit cards all provide us with ample opportunities to purchase anything we want and have it delivered to us within hours or days. 

You can’t get away from the simple fact that you have to spend less than you make in order to build wealth. 

There are only two ways to do this: spend less money or make more money.  

The mistake I see most people make is thinking that making more money is the answer to their financial problems. 

Having coached many people with six-figure incomes, I can tell you that you definitely will still have these problems, but there will just be more zeroes on the end of the numbers.  

You have to rein in your spending if you want to have any chance at building wealth.  This is why I spend so much time talking about budgeting when I’m doing financial coaching. 

Very few people approach me for financial coaching and ask about budgeting.  They always want to know about retirement planning or debt elimination plans, but it all starts with the budget. 

You have to know how much you make, and you have to resolve to spend less than that.

In my financial coaching experience, seven out of ten times that someone is overspending their income, it’s because of unrealistic spending habits, not lack of income. 

Getting this under control often requires radical changes, such as:

    • Selling cars to get rid of car payments
    • Homeschooling your kids
    • Moving to a new house or apartment to get their mortgage/rent payment down.  

A liberating thing happened to me when I started learning all of this stuff.  Once I realized that I was the problem, I realized that I was also the solution.  All I have to do is get control of my own spending habits, and I can win with money! 

Now, that’s easier said than done, but it put the power for my life and my finances in my hands.  No one else can fix that for me, and no one else is going to fix it for you. 

Living beneath your means starts with knowing how much money you make and resolving to spend less.

Take a look at my three-part series on budgeting and get started on yours today! 

3. Lack of an emergency fund or proper insurance coverage

Many people don’t want an emergency fund, though many of my financial coaching clients don’t want to hear about that. I hear many physicians and high income families say that they don’t think they need an emergency fund.  

Well, let me tell you that you definitely DO need an emergency fund.  Do you know why?  Because emergencies happen!  

I see all kinds of websites that will say dumb things like, “You don’t need an emergency fund.  That money won’t earn you any returns.  It’s just sitting there not working for you.  Put that money to work and then use a credit card or a home equity line of credit (HELOC) if you have an emergency.” 

That’s an incredibly hazardous approach. 

The last thing you want in a financial emergency is to incur more debt.  That’s a good way to precipitate a crisis.  

The emergency fund is not there to earn money.  It’s to protect the things that do earn money. 

When you have a sudden unexpected large expense like a car engine blowing up, or an unexpected medical bill, there is great security in being able to take cash from the emergency fund to pay for it so you don’t have to cash out a 401(k) or take a short-term personal loan at a high interest rate to cover the expense.  

It’s insurance, not an investment. 

Insurance costs money so that you can protect that investments that make money.

Having inadequate insurance coverage is another way to get yourself in a mess financially.  Uninsured medical expenses or catastrophic property loss can bankrupt you if you don’t have adequate coverage. 

If you get in a car accident or your house burns down, you could be looking at mid-six figures in losses.  Having the right kinds of insurance is crucial to your wealth building strategy so you don’t lose the assets you spent so long building.  

For more information on emergency funds or insurance, take a look at my posts on those topics.  

4. An inappropriately favorable view of debt

  • “There’s good debt and bad debt.”
  • “You need debt because you need to build a credit score.”
  • “It’s not debt, it’s leverage.”  

These are a few of the myths that too many people believe about debt in America, and my financial coaching clients have said these words to me many times. 

Companies spend more money marketing debt vehicles than they spend marketing any other product today.  Companies bombard us with credit card offers, reverse mortgages, home equity loans, and car leases.  

Debt is the number one thing that inhibits your ability to build wealth.  All the interest you pay to that car company or to the student loan company is interest that you could be earning in your IRA if you were debt-free.  

Debt = risk  

This is a major component missing from people’s financial calculations.  People look at paying off a 2% car lease vs investing in the stock market at 7% and imagine the sophisticated choice is to make the investment in the stock market because the car loan is “cheap debt.”  

By that logic, you should want to take out millions of dollars against car loans to invest in the stock market, but no one would ever argue for that.  The difference comes in feeling the risk attached to debt.  

Debt gives you limits.  Being debt-free gives you choices.  

Don’t fall for the lie that debt is your friend, or a great tool to build wealth.  

Pay off those credit cards, student loans, and car loans as fast as you can.  Don’t keep them around like a cherished family photo album.  Get them out of your life!

5. Lack of contentment

Many of the views on debt being necessary stem from a lack of contentment.  When we want something, we want it right now.  If we can’t pay for it, we’ll just put it on a credit card and pay for it later.  We think we deserve the things that we want, regardless of our ability to afford them.  

This attitude is strangling the financial lives of all generations of Americans right now.  We need to get back to a place where we can delay gratification long enough to save the money required to purchase something responsibly.  

Quit trying to keep up with the Joneses.  I’ve coached the Joneses and they’re broke!  

That awesome vacation they posted pictures of on Facebook is sitting on a credit card racking up 18% interest every month.  Their great new car is going to lose 40% of its value in the next 4 years, and their car payment is over $500 per month!  

Spend less than you make, buy things when you can afford them, and quit trying to “live in the moment.”  Fear of missing out (FOMO) in the short-term will make you actually miss out on the joy of retiring with enough money to live comfortably and be outrageously generous for the rest of your life.  


These mistakes are pervasive throughout American culture, reinforced by uninformed friends and companies that are constantly trying to convince you to buy now and buy often.  

Take time for some self-reflection.  Which of these lessons can you start to apply in your own life that will get you on the path to building wealth and securing your family’s financial future?  

Remember, if you are the problem, you are the solution!  I hope you take encouragement from the fact that there is no great secret to becoming wealthy. 

These simple lessons are universal and applicable, although they’re not easy.  It’ll take time and effort, but it’s worth it. 

If you’re reading this, you obviously care enough to make it a priority.  That intentionality is the first step towards financial security.  One step at a time, you’ll get there.  I believe you can do this!  

Further reading

Leave a comment below and tell us about a financial lesson you’ve learned that helped you get on the path to building wealth.  If you could recommend one thing to help others win with money, what would it be?

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Comments (4)

  • I agree.
    The basics of financial responsibility are – well – basic.
    Keep debt manageable. Keep spending in check. Optimize income.
    Cover risks.
    The biggest problems I see with our fellow doctors are:
    1. Focusing on income rather than building Net Worth.
    2. Spending more than they need and not realizing how that limits their future.
    Keep up the great posts!

    • Wealthy Doc-
      Thanks so much!! I appreciate the encouragement. Yes, it’s amazing how simple these things can/should be. When I’m doing one-on-one financial coaching, it surprises people when I tell them that the combined age of my two cars is almost 20 years. But, it’s paid for and it gets me where I’m going. Spending is the downfall of many financial plans. Thanks so much!

  • Got you beat, the combined age of our cars (2007 & 2008 Hondas) is 25 years. But who’s counting? My wife’s goal is to take her 2007 civic to about 300,000 miles, close to 200,000 at this point.

    This single practice supports all 5 of the ideas you mentioned above.


    • Max-
      25 years, wow! Maybe I should trade mine in for some older models. Ha ha! That’s awesome! Swim against the stream!

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