Personal Financing Planning concerns not only an individual’s expenditure, but also financial forecasting techniques, which help in investment decision making. The adoption of Personal Financing Planning is not only beneficial to individuals, but also the government and the public in general. The roles of Personal Financing Planning as a profession are uniquely designed to meet individual’s financial needs at any given time and place. Since dynamic factors such as inflation, currency devaluation, and exchange rate affect the financial needs of individuals, Personal Financing Planning professionals develop and implement new techniques suitable for every unique need. This helps in reducing the risks of financial losses to individuals and families.
Personal Financing Planning constitutes all aspects of an individual’s finances and all factors affecting the value of these finances. These aspects of individual or family finances include sources of money, areas of expenditure and investment opportunities. Personal Financing Planning helps in calculation of an individual of family’s gross and net income from all income sources such as salary, rent, personal loans, and dividends from shares. Further, it establishes possible investment avenues such as buying of stock market shares, acquiring of assets such as land and building, and retirement plans. Many countries lack legal framework to regulate Personal Financing Planning. This has allowed many unqualified persons to use the title of “financial planner” indiscriminately. To curb the malpractice activities, Personal Financing Planning professionals from different parts of the world initiated the formation of regulating bodies to maintain order and encourage professionalism in the industry. The formation of bodies such as Financial Planning Authority (FPA) and Financial Planning Standards Board (FPSB) is a result of the resolution of Personal Financing Planning practitioners. However, much still needs to be done, as illegal practices are still rampant in the industry.
Personal Financing Planning requires wide knowledge from different fields. Qualification as a Certified Personal Financing Planner (CFP) requires a bachelor’s degree in business, certificate in financial planning from CFP Board, and a considerable experience. Many institutions offer postgraduate diploma in financial planning, which can help enhance knowledge and much required skills in the field. Additionally, a master degree in financial planning is an added advantage. The complexity of problems financial planners handle requires additional knowledge in accounting and finance, to assist families and individuals in navigating through life’s vicissitudes. Since most financial planners work under no supervision, discipline and good communication skills are essential requirements for their success.
There are many obstacles to becoming an accredited Personal Financing Planner. First, gaining the much-required qualifications is expensive and time consuming. In fact, for one to acquire a bachelor’s degree and a certification in Personal Financing Planning, he or she may incur an approximate cost of $160,000. The other obstacle is the mushrooming of many institutions offering financing planning training, most of which are not accredited. The rewards are worth the risk as most Personal Financing Planners earn up to $ 70,000 per annum. A practitioner who furthers his or her education in related fields such as public relations, counseling, and stock market prediction, is likely to win clients’ trust easily hence more earnings. Successful and established Individuals in Personal Financing Planning create employment opportunities for others who are new in the field. Such individuals, either on attachment or on taking first employment, are assigned simple tasks due to their inexperience. Such tasks may include, helping clients in calculating their income and finding areas of expenditure they could cut down with little effects.