By Maryalene LaPonsie, Online Education Columnist
If you spend more than you make, does that mean you are living within your means?
According to a recent Country Financial survey, for some Americans, the answer may be yes. The survey discovered a “perception gap” between what people are actually spending and how they see their financial situation.
While some individuals may be wearing rose-colored glasses when it comes to finances, there is help available for those who want to improve their family’s money situation. Personal financial advisers offer one-on-one consultations that can be used to work out kinks in the budget, rev up savings or meet long-term financial goals.
Overspending and oblivious
In its survey, Country Financial discovered good news and bad news when it comes to personal finance. The good news is slightly more than half of surveyed households have a budget in place. The bad news is this budget may be giving families a false sense of financial stability.
Only 9 percent of survey respondents felt their lifestyle was more than they could afford. However, at the same time, half report their monthly spending exceeds their income at least a few months of every year. In addition, more than one in five say their monthly spending exceeds their income at least six months of the year.
To pay for these extra expenses, respondents used a variety of tactics:
- Dipped into savings: 36 percent
- Used a credit card: 22 percent
- Delayed bill payments: 12 percent
- Borrowed money: 8 percent
However, only 14 percent of those exceeding their monthly income reported adjusting their spending for the following month to get back on track.
Personal financial advisers: helping families see the light
While there is no shortage of DIY budgeting books, online tools and other resources available, sometimes you need to call in a professional. Personal financial advisers can offer an objective review of a family’s finances and spot red flags such as regular overspending. Once the problem has been identified, they can make recommendations for a realistic budget that will stick.
Advisers may work with financial firms or be self-employed. Many schedule appointments in the evenings or on the weekend when it may be more convenient for clients to meet. Generally, they will review financial information, work with clients to identify goals and then implement a financial plan. Some personal financial advisers may also sell insurance and investment products.
The Bureau of Labor Statistics reports that personal financial advisers should be in high demand during the coming years. From 2010 to 2020, positions for this occupation are expected to grow 32 percent. In addition, advisers are well compensated: average annual pay in 2011 was $90,900.
Becoming a personal financial adviser
If the thought of helping others straighten out their budgets and reach their goals sounds appealing, working as a personal financial adviser may be a smart career move.
Financial advisers need a bachelor’s degree for most entry-level jobs. Degrees in finance, economics, business or accounting are relevant choices for those interested in working as an adviser. Some professionals then go on to earn a master’s degree in business administration or finance to increase their opportunities of moving into managerial positions or otherwise advancing their career.
Personal financial advisers who wish to sell insurance or investment products may need to be licensed by their state and/or registered with the Securities and Exchange Commission. In addition, there is a voluntary Certified Financial Planner credential available. Offered through the Certified Financial Planner Board of Standards, the designation is available to advisers with a bachelor’s degree and three years of experience who have also passed a board exam.
Some Americans may be confused about the real state of their family finances, but personal financial advisers can help. With 32 percent growth anticipated in the coming decade, now is the time to prepare for this hot career. Get a jump on the competition by checking out business degree programs today.
Maryalene LaPonsie has been writing professionally for more than a decade on topics including education, insurance and personal finance. She holds a Bachelor’s Degree in Political Science from Western Michigan University.