Skip to Content

Does a Life Coach Need a Business License?

Generally speaking, NO. A life coach does not need a business license to practice in the United States. But you have to understand that this can differ from city to city, therefore it is very crucial to check your local business regulations to verify if you need a license to practice.

Even though you don’t need a business license, you will still be expected to name your business and set up a legal structure. If you aim to become a full-time life coach, then you should set up your business as an LLC so you can have limited liability protection. Meanwhile, if you intend to work as a life coach on the side or just see a few clients a year, then you can go with a sole proprietorship, which is quite common than LLCs in the life coaching industry.

When you choose a limited liability corporation or a sole proprietorship, you must ensure that you have the right certification to work as a life coach. One of the key issues in the life coaching industry is that it is not regulated, and this entails that anyone can refer to themselves as a life/professional/personal coach.

This does not in any way mean that anyone who is good at controlling their own life or offering good advice to friends can do well as a life coach. Even if you have learned your methodology and concept of life through past careers, traveling, personal growth programs, or coach training, always remember there is just one pertinent thing: you must be able to bring about the results your clients need.

Selecting the tools you need to achieve those results is up to you. The least a coaching certification can do for you is to furnish you with detailed frameworks and a coaching methodology that has been tried and tested. Most often, it also includes personal mentoring from successful master coaches.

Note that by completing a thorough coaching certification, you’re bagging 100+ hours of practice and training that gives you the needed knowledge to stand in front of your first client with the confidence of “I understand what I’m doing.” Therefore, whether to start your coaching career with certification, get it later, or decide not to get any, the choice is yours to make.

Basic Requirements of Becoming a Life Coach in 2023

Agreeably, there are no set laws to adhere to and no legal state or federal guidelines to comply with when looking to become a life coach in the United States, however, there are a few basic requirements to become a life coach.

  1. Business Registration

Just like it was stated above, you have two options when it comes to choosing a legal structure for your coaching business. You can choose to run your business solo or register a company that also allows you to hire a team. If you intend to offer your coaching services as a freelancer or self-employed individual, you can structure your business as a sole proprietorship.

However, if you intend to establish a company independent from you and hire employees, you’ll have to register an LLC or limited liability company. Note that this is a more expensive option that also warrants more paperwork, but it allows you to grow your coaching business and also safeguards you from personal liability.

  1. Legal Disclaimers

In this line of business, if you intend to accept bookings or payments through your website, then it is very necessary to include your terms & conditions on your checkout page. Note that this will serve as a contract between you and your client that they automatically accept by signing up for your services.

In addition, consider sharing a privacy policy on your website, at least to let your website visitors understand how their data would be used. Although this is not in any way a necessary step, but it is a simple disclaimer that will protect you from any lawsuits on private data in the future.

  1. Training and Certification

Although you don’t need to be trained or certified to become a life coach, but it is something you need to consider extensively. Have it in mind that the paper hanging on the wall will let your clients know that you have undergone training.

In addition, training is never meant to end – as long as you are a coach, you should endeavor to keep acquiring more education. More training and certifications won’t hurt; instead, they keep you up to date with industry trends and materials.

  1. Insurance

The best way to protect your business against lawsuits is to obtain adequate insurance. In the United States, numerous coach-friendly insurance companies have packages tailored for small business owners. Note that these businesses offer a plan called a business owner’s policy or BOP where you can customize the business needs you want to be insured against.

The most common part of a BOP would be Professional Liability Insurance. This insurance type safeguards you as a coach (or your coaching business as an LLC) from any accusations related to negligently performing your services. Other insurance coverages to consider include;

  • General Liability Insurance against general claims on damage to property or personal injury;
  • Commercial Property & Auto Insurance to secure your business assets such as your office and car;
  • Cyber Liability Insurance against any data leak regarding private client information;
  • Workers Compensation Insurance in case you have employees to pay.
  1. Dedication and Commitment to Clients

If you are in this coaching field for the money, you may end up not making that much money. But if you are in this field because you have a desire to help people attain their goals and dreams, then you will become very successful in this field. Always remember that one of the most vital requirements to become a successful life coach is total dedication and a solid commitment to the success of your clients.

  1. Ethics and Honesty

Truth be told, we all have our ideas regarding ethics and honesty, and though they may differ accordingly, they are more or less universal in meaning. Note that you can take the ethics of a professional coaching association, and fuse them with your general framework of ethical behavior and conduct. It is always imperative that you use the highest standards of ethics and honesty when dealing with every client.

  1. Objectivity

In this business field, always remember that you aren’t a friend or a foe – you are just an objective partner. Note that you are expected to be objective so that you can understand their issues. Always remember that objectivity is one of the keys to getting solutions that work for your clients.