Expert Interview with Rebecca Wiggins on Financial Counseling and Education

rebeccawiggins.jpgMuch like the board game Othello, personal finance and healthy economic habits take a minute to learn, but a lifetime to master.

There has always been a lot to know and keep up with in the field of financial education, but this has increased exponentially with the increase in information and technology. This makes organizations like the AFCPE more mandatory than ever before.

Since 1983, the Association for Financial Counseling and Planning Education has set the standards for the field of personal finance and finance counseling. AFCPE professionals have helped individuals and families learn, grow, and cultivate their best financial practices.

AFCPE's Rebecca Wiggins took a moment out of her busy schedule to share some of three decades worth of experience.

 

To start, could you tell us a bit about the Association for Financial Counseling and Planning Education? How did you get started, and what are the goals of AFCPE?


AFCPE was founded in 1983 by experts in the field who recognized the need for professional support for financial counselors and educators. Our organization is uniquely built upon decades of field research, from which our certification programs like the AFC® (Accredited Financial Counselor) were created. Our certification marks represent the highest standards of excellence in the field of financial counseling and education. AFCPE programs train professionals to guide clients through a holistic counseling framework of life-cycle financial education. This allows the professional to provide a high-level, tailored approach based on the needs of each client to effectively analyze and create lasting financial behavior change. AFCPE's mission is to provide professional development experiences for financial educators, practitioners and researchers to improve the economic well-being of individuals and families worldwide.

 

How would you define personal financial management, and why is this important?


Personal financial management is the planning process behind necessary healthy financial habits that allow an individual or family to realize financial freedom and achieve financial goals. In this digital age where consumers have less direct interaction with money, these skills are becoming more important than ever. The process of developing a budget, creating short-, medium- and long-term financial goals, and establishing an emergency fund and savings account all provide a realistic picture of how money is spent each month. These are essential components to creating a secure financial future.

 

The website states that your services are meant for educators, practitioners and researchers of personal finance. Can you give us an example of some industries that most frequently work with AFCPE? What are some ways that individuals can benefit from what you do?


AFCPE supports professionals from a variety of sectors. Many of our professionals inform the work of the field through academic research. AFCPE professionals also provide financial education to service members and their families on military installations, or through classes they teach at a college or university. Others work in banks or credit unions, financial aid offices, or law firms. Many work in Cooperative Extension, nonprofit community agencies, credit counseling agencies, or private practice. What makes our professional base so unique is the overlap of educator, researcher and practitioner roles and the way our professionals work together, support each other and strengthen the work being done in the field.

 

You talk about "intimidating investing terms, hidden fees and product sales" in the section on your site about Financial Counseling. What are some common terms or hidden fees that people should be on the lookout for?



Many financial and investing terms can be confusing, like the differences between accounts: Roth, IRA, 529 or 401(k) plans, or understanding asset allocation, diversification and management expense ratio. Consumers are often unaware of hidden fees on credit cards and bank accounts. That's why working with an AFC® Professional can be so helpful. The AFC mark confirms that the professional has the comprehensive educational background to help you understand the terminology and then provide you with unbiased guidance based on your unique needs and goals.

 

Can you tell us a little bit about your Accredited Financial Counselor and Certified Housing Counselor programs? Who would be most likely to get these certifications, and what can they hope to gain from it?


The AFC® (Accredited Financial Counselor) certification is a valuable and nationally recognized certification that lends credibility to the competency of a financial counselor or educator. It is a comprehensive and rigorous program in which candidates must fulfill education requirements, pass a national exam, and obtain practical experience in the field before using the AFC mark. Additionally, certificants are held to the highest ethical standards and are required to maintain the designation through professional development to stay updated in the field.

The AFC certification is valuable to anyone working to help people manage their personal finances, especially when focused on cash management/budgeting, debt management/elimination, developing positive financial behaviors, etc. This includes financial counselors and educators but also extends to university staff such as in financial aid or the office of student affairs, social workers and other social service professionals, employees in community based organizations and other nonprofits, employee assistance professionals (EAP) and even those working in governmental offices.

The CHC® (Certified Housing Counselor) certification is a specialization that an AFC can choose to pursue, and requires the candidate to demonstrate additional competence and specialization to assist clients with housing issues.

 

AFCPE Certified Professionals help clients implement effective spending plans and eliminate debt. Can you give a couple of basic tips that people would be likely to encounter in one of these consultations?

Identify Goals/Priorities.

The key to maintaining an effective spending plan is to recognize that its purpose is to help you get what you want most! It's important to begin by considering what things in your life are most important to you and establishing financial goals that can support those priorities and help you achieve your desired outcomes. Having a clear view of what you really want and why can make certain purchases (especially impulse buys) less appealing and help you stay on track. Your perspective can change from "I can't" or "I shouldn't" to "I don't want to."

Accelerate the Process.

Many people that are in debt feel trapped and become overwhelmed, feeling that they will never get out. Paying only the minimum payment can result in the feeling that you're making no progress, so put a little extra each month toward one of your balances. While you may not have much more to put toward it, a small amount can have a fairly dramatic effect. As little as $15 - $25 could help you pay off a credit card debt five to 10 years sooner! Credit card companies are required to include information about accelerating your payoff on your monthly statement, so take a look. Additionally, once you pay off one debt, if you then roll that amount into paying other debts, you'll really start to see the results!

 

AFCPE publishes the Journal for Financial Counseling and Planning twice a year, which helps you to keep up with the industry. What are some trends you've been noticing or things we might expect in the financial planning industry in the coming year?



AFCPE Researchers certainly have their finger on the pulse of this field. There seem to be a variety of trends that we can continue to expect in the coming year for the financial counseling and education field. For example, implementation of the Affordable Care Act, consumer debt, the rising cost of college education, payday lending, and increased interest in prize-linked savings to name just a few. Join AFCPE Membership for access to this cutting-edge research and newsletter articles for the field.

 

In a recent interview for BadCredit.org, you detailed reasons why someone should consider consulting an Accredited Financial Counselor. Could you briefly recap the main points you made, as well as the difference between a Certified Financial Planner versus an Accredited Financial Counselor?

The Certified Financial Planner® (CFP®) mark demonstrates credibility and expertise in providing financial planning services for consumers. Likewise, an AFC® (Accredited Financial Counselor) has comprehensive training and experience on credit and debt, personal financial management and the complexities of a client's financial life cycle. AFCPE Professionals do not sell products. An AFC helps provide a thorough education of a client's options and makes lasting behavioral adjustments. They may eventually refer a client to a trusted investment adviser or financial planner like a Certified Financial Planner® (CFP®) for wealth planning advice.

 

Are you aware of any essential apps, websites, or software that everyone trying to get their finances in order should be using?

There are so many helpful resources and tools out there, but here are just a few:

  • AnnualCreditReport.com: The official site to get a free credit report each year from each of the three credit bureaus.
  • PowerPay.org: This is a great free resource designed to help people identify simple ways to pay down debt faster and develop a plan to do so. See how much you can save (and put toward other goals) without even increasing your monthly debt payment.
  • Mint.com
  • YNAB: While there is a small one-time fee to use this software, it provides solutions to many of the common difficulties people face when trying to maintain a budget/spending plan. They offer a free month trial including access to their live webinars and trainings on how to use their program. It is also free to university students.
  • Credit Karma and/or Credit Sesame: These apps/websites provide free information including credit reporting and estimated credit scores (each uses information from a different bureau).
  • NEFE
  • FTC.gov
  • Next Gen Personal Finance

 

You deal with a lot of people in debt. In your personal observations, does it seem like the economy is improving? In your prediction, do you think things will improve in the new year?

There are many signs over the last several years that indicate a growing economy. Unfortunately, many people in this country and around the world are still not feeling it in their own lives. That's why we are committed to closing the access gap to financial education and unbiased financial information, so that every individual has the opportunity to get on a positive financial path and feel hopeful about their future. With the help of an AFC®, more people will feel the improvements in their own lives.

For more expert guidance and financial education, make sure to like AFCPE on Facebook, connect with them on LinkedIn, and follow them on Twitter.