Small Business Loans for Life Coaching

In 2019, a report by the global research company IBISWorld valued the life coaching industry at $15 billion, representing an annual growth rate of 5.6% from the industry’s $2.356 billion value in 2015. This report also predicted several future growth trends for the industry, but the arrival of the COVID-19 pandemic in 2020 changed this promising forecast.

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A 2020 revision of the same report predicted a revenue decline due to the COVID-19 economic crisis restraining consumers’ disposable income. As a life coach, you might be intimately familiar with this shift in demand and its impacts on your company’s bottom line. You might also have considered that small business loans for life coaching could help you make up for your revenue loss, and low-cost funding options do exist – read on to learn more.

Financing Options for Established Life Coaches During the COVID-19 Coronavirus Pandemic

As COVID-19 case rates increased exponentially in March 2020, the federal government enacted the CARES Act. Among the provisions of this bill was the Paycheck Protection Program (PPP), a new Small Business Administration (SBA) 7(a) loan program. Through PPP loans, life coaches and other small business owners could obtain funding to stabilize or grow their companies.

For updates, visit the SmartBiz Small Business Blog, which also has information on loan opportunities and forgiveness. Additionally, the SmartBiz Loans COVID-19 information center, Small Business Loans & Resources in Times of Coronavirus (COVID-19), can educate you on valid PPP loan uses.

Applying for a first or second PPP loan in 2021

The SmartBiz streamlined PPP Loan application can help you fill out your application, upload required documents, and submit them to the bank quickly.**

SmartBiz can help you apply for these funds. We have specialized in SBA loans since 2013 and our network of banks has funded nearly $4 billion in SBA, PPP, and bank term loans.

Whether this is your first or second PPP loan, SmartBiz can help! Businesses with less than 500 employees that are negatively impacted by the pandemic can apply for their first PPP loan.

The program expires on May 31, 2021. No applications will be accepted after that date. Keep an eye on the SmartBiz Small Business Blog for updated information about an extension if approved by congress.

Funding challenges and opportunities for life coaches

Most challenges related to funding a life coaching company are the same as businesses in all industries face. These challenges include lenders’ hesitation to approve borrowers from industries negatively affected by the COVID-19 pandemic or borrowers with minimal business ownership experience. On the other hand, life coaches have unique funding opportunities not as prevalent in other sectors.

For example, certain foundations offer life coach training scholarships, thus eliminating a major financial obstacle to a life coaching career. Additionally, some professional life coaches say that invoice financing and rollover for business startups are viable methods for funding life coaching companies. However, the amount of funding you can obtain from these routes may be limited compared to the many types of loans detailed below.

Financial options for life coaches

Life coaches can pursue SBA loans or non-government funding. No two small business loans for life coaching will have exactly the same approval periods and rates, but you can get a general sense of what to expect via the below guidelines.

The SBA 7(a) loan program

Low-cost SBA 7(a) loans are widely considered the best funding option for life coaches if you qualify. These loans are ideal for small businesses since they have low rates, long terms, and low monthly payments. You can use them to:

  • Obtain Working Capital Working capital may be the single most important indicator of your life coaching business’s health. You can calculate it by subtracting your current liabilities from your current assets or simply determining how much cash you have immediately available for business use.
    Negative working capital means that to grow your assets, you may need to buy new equipment (perhaps to expand your services) or hire more employees. You can use an SBA 7(a) loan for both these purposes.
  • Consolidate Your Debts – You can use SBA 7(a) debt consolidation loans to refinance your current life coaching loans. These include merchant cash advances, daily or weekly payment loans, high-interest business loans, or short-term business loans.
  • Purchase Commercial Real Estate – If you plan to open a new location for your life coaching company, your SBA 7(a) loan can go toward your launch expenses. Use them to purchase owner-occupied commercial real estate or refinance your current commercial real estate mortgages.

Advantages of SBA 7(a) loans for life coaches

Lending experts widely agree that SBA 7(a) loans are the “gold standard.” Their power for small businesses stems from their:

  • Wide use of funds
  • Lack of prepayment penalties
  • 10-year terms (25 years for commercial real estate loans)
  • Low rates
  • Affordable monthly payments
  • Availability in all 50 states

Requirements for life coaches to apply for SBA 7(a) loans

If you and your life coaching business meet all the following requirements, you may qualify to apply for SBA 7(a) loans:

  • Your life coaching company must be based in the U.S.
  • You must be at least 21 years old
  • Your personal credit score must be above 650
  • You must not have bankruptcies or foreclosures in the past three years
  • Your life coaching company must be at least two years old
  • You and your company must be on-schedule with all government-related loan repayments
  • Your company must have no recent settlements, outstanding charge-offs, or tax liens
  • You must be a U.S. citizen or lawful permanent resident

Some, but not all, lenders may have more provisions than these basic requirements. For example, whereas some loan providers will need to see your business plan, SmartBiz Loans will not.


How to apply for an SBA 7(a) loan for life coaches

Step 1: Confirm that you meet all the above SBA 7(a) loan requirements. Learn more about your requirements via the SmartBiz Loans page SBA Loan Requirements for Existing Businesses.

To discover how your business financials stack up for funding, use our easy-to-use online tool. SmartBiz Advisor™ helps you track the financial health of your business and learn how banks typically evaluate your business.* SmartBiz Advisor also recommends ways to help you improve your credit and strengthen the financial health of your business as needed. Read feedback from real SmartBiz Advisor users and sign up here.*

Step 2: Collect all your required paperwork, and don’t be afraid to ask for help from your bookkeeper, accountant, or any other financial experts who know your business well. Read the SmartBiz Loans Guide to SBA Loans for more information.

Step 3:  Choose your lender while prioritizing the following factors:


Look up your lender on Consumer Affairs, Google, and TrustPilot, where you should see plenty of customer reviews. Use these reviews to decide whether the lender is right for you. Make sure you’re reading reviews by real customers, and try to find other life coaches among the reviewers if possible.


Your loan should include interest and repayment fees. Excessive additional fees may be a sign that you should opt for a different lender. Additionally, it’s important to ensure that all your fees are due before your loan’s funding and during your loan’s lifetime.


Look for clearly outlined interest rates and APRs. Any attempts to obscure this information may suggest that your lender won’t properly detail your loan terms, which means that you could find yourself attached to an unsatisfactory loan.

Obvious loan terms

As with crystal-clear APRs and annual interest rates, your loan’s fine print should be easy to understand. Complex fine print can mask unfavorable loan costs and payment schedules, so don’t hesitate to ask for a total loan amount, payment amounts and frequency, collateral requirements, and any prepayment penalties. Additional attempts to keep this information hidden from you mean it’s time to look elsewhere for small business loans for life coaching.


No matter how favorable your loan terms are, you might not have as good of a borrowing experience without your lender making its team immediately available to you for further inquiries. Your best bet is choosing a lender that connects you to an easily reachable representative who is deeply familiar with your company, application, and the whole world of life coaching.

The SBA 504 loan program

Through the SBA 504 loan program, you can obtain low-cost funding for modernization or expansion efforts. SBA 504 loans can go toward opening new locations, hiring new employees, or upgrading your equipment.

Additionally, if your life coaching business meets the public policy goals of your local community development corporation (CDC), your SBA 504 loan can cover up to 50% of your project costs. Your CDC will step in to cover 40%, leaving just 10% to you.

The SBA microloan program

If your life coaching business meets the SBA definition of a very small business (a.k.a. microbusiness), you may qualify for the SBA Microloan Program. Microloans never exceed $50,000, but you can use them for all business needs except paying debts and buying commercial real estate.

Non-SBA loans and other funding options

While SBA loans are usually the best small business loans for life coaching, you have other options if you don’t qualify. These alternate funding methods may have larger payments, shorter terms, and higher rates than SBA loans. They include:

Bank term loans

Bank term loans provide funding as quickly as SBA loans while similarly allowing for debt refinancing or working capital investments. Should you pursue bank term loans, inquire with any prospective lenders about your rates, repayment terms, potential loan amounts, and (if applicable) prepayment penalties.

Merchant cash advances

If you accept credit or debit card payments from your life coaching clients, you can consider merchant cash advances (MCAs). Through this form of small business funding, you can borrow money from a card provider and repay it by funneling a small portion of all transactions back to the card company. You can also opt for standard installment-based payment plans.

Although MCAs are convenient, you pay for their ease: MCAs are known to have extremely high APRs. Learn more via the SmartBiz Loans blog What You Need to Know About an MCA.

Business lines of credit

Business lines of credit are loans of a maximum amount determined by your credit score, though usually less than the funding you would receive through a bank term loan. However, unlike bank term loans, business lines of credit don’t require you to use all your funds. In fact, it may be smarter not to use your full line of credit since you won’t pay interest on money that you don’t use.

You can access your business line of credit as often as you want until it runs out. Business lines of credit typically do not have the same collateral requirements as other loan types, potentially making them safer funding bets. Learn more about business lines of credit via the SmartBiz Loans blog Small Business Lines of Credit Pros and Cons.

Business lines of credit resemble business credit cards in that both options are revolving lines of credit. However, only business lines of credit completely expire when you use all their funds, whereas business credit cards become available again after you repay your loans. Additionally, some business credit cards include spending rewards that business lines of credit never provide. Learn more about business credit cards via the SmartBiz Loans blog Finding the Right Credit Card for Your Small Business.

Why Choose SmartBiz Loans?

Need funding to rebuild your business? Don’t waste time going from bank-to-bank filling out multiple applications. SmartBiz helps you find the best financing for your unique needs whether that’s an SBA loan, Bank Term loan, or other financing.  About 90% of qualified applications we refer to banks are funded and our financial professionals are on hand to answer your questions. Discover if you’re pre-qualified here without impacting your credit scores** and read the SmartBiz 5-star customer service reviews on TrustPilot.

 *The information provided through SmartBiz Advisor, including the Loan Ready Score, is for educational purposes only. SmartBiz Advisor is not a financial or legal advisor as defined under federal or state law. Use of this information is not a replacement for personal, professional advice or assistance regarding your finances or credit history.

**We conduct a soft credit pull that will not affect your credit score. However, in processing your loan application, the lenders with whom we work will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and happens after your application is in the funding process and matched with a lender who is likely to fund your loan.

 What you need to know: The information provided through SmartBiz® University and the articles contained therein are for educational purposes only. Use of this information is not a replacement for personal, professional advice or assistance regarding your finances or credit history.