Financial counsellors sometimes get mistaken for financial planners, who are paid to make a plan and a projection showing the decisions you can make in achieving long-term financial success. What you need to know is that financial counsellors do not function like financial planners.
What is a financial counsellor?
Financial counsellors are specialists who have completed a Diploma of Community Services (Financial Counselling) and must be members of or qualified to be constituents of a recognised State or National Financial Counselling Association. They can help you learn how to manage your financial resources.
How can financial counsellors help you?
If you are experiencing financial difficulties, financial counselling services can help you by diagnosing, presenting, and defining options for money issues and by giving information and advice about the following:
- Advantages and disadvantages of bankruptcy
- Debt and credit-related matters
- Rights of debtors
- Come up with a realistic debt payment plans
- Support services such as emergency relief, family support, gambling, legal aid, and personal counselling.
A financial counsellor can help you complete bankruptcy forms or negotiate with creditors on your behalf.
What happens when you work with financial counsellors?
During consultations, financial counsellors focus on providing advice and information specific to your needs. They will make use of all available information about your financial situation for budget preparation or financial standing snapshot to determine where your money is going. Also, they will likely to ask you regarding your ideas on managing the situation and reclaiming control over your finances.
A financial counsellor will also provide advice on which of your debts should be prioritised and how you can apply for hardship consideration for a wide range of debts. What they will not do is to take over your finances or deal with your money directly.
What to prepare before speaking to financial counsellors?
There are things that you need to let financial counsellors know in order for them to get a full picture of your finances. You must provide the details of your income, current bills, a list containing all of your debts, information about all loan agreements, any court documents, and letters about urgent bills and debts.
Why do you need financial counselling?
There are many reasons why you should seek financial counselling, especially if by chance you lack the knowledge and skills that are necessary for financial management. Some of us only get to learn about it through personal experience and from observing others’ way of managing their finances.
Usually, what motivates people to seek for services of financial counsellors are the following:
Income-related problems. This includes layoffs, unemployment or underemployment, accident or illness, retirement, family abandonment, and what have you.
Expense problems. One of the reasons why you should solicit financial advice includes changes in the situation of a person or family, unplanned increases in regular and irregular expenses, and lack of a financial cushion needed for emergencies.
Debt management. Credit use can influence a person’s financial management. This is why you need financial counselling to deal with impulsive/compulsive spending, setting up housekeeping, and many more.
At some point in time, you will need financial counselling. But before you settle on one, be guided on how to find a financial counsellor who can give you quality financial counselling services.