How to Become a Credit Counselor

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How to Become a Credit Counselor: Career Path Guide

If you want to become a credit counselor, you first need to determine if this career path is a good fit for your skills, interests and personality traits. If the following description sounds like you, then you’re probably well suited for a career as a credit counselor:

 

• You have a keen interest in helping people get their finances back on track

• You enjoy teaching and advising others

• You have excellent listening skills and are able to put others at ease

• You work well with numbers and with people

• You enjoy gathering and analyzing financial information

• You are willing to compete for relatively few job vacancies

• You are willing to negotiate with creditors on behalf of others

 

Below we've outlined what you'll need to begin a career as a credit counselor. We've also included helpful information for this career, such as job description, job duties, salary expectations, educational requirements, a list of employer types, and much more!

 

 

Education Needed to Become a Credit Counselor

The educational requirements for becoming a credit counselor typically vary by employer. Typically however, job vacancies for credit counselors are highly competitive, and you will likely need a bachelor’s degree in a relevant field if you want to become a credit counselor, as well as professional certification.

 

A relevant undergraduate degree will most likely be one in accounting, finance or economics. A degree in one of these fields will provide you with an understanding of complex financial matters, a perfect knowledge base to help clients solve their financial problems.

 

A relevant degree however, could also be in psychology, social work, human ecology or counseling. In addition to dealing with financial issues, credit counselors need to be able to provide advice and guidance regarding some of the most emotional and sensitive issues their clients face. A degree in one of these fields can help credit counselors develop the appropriate interpersonal skills to allow their clients to trust them and be comfortable talking to them about these sensitive issues. 

 

Success Tip: Beware of organizations that will hire you as a credit counselor with only a high school education and no relevant work experience. These organizations are typically of lower reputation, and working for them won't necessarily look good on your resume. 

 

 

 

Credit Counselor Job Description

Credit counselors, also known as debt counselors, are responsible for providing counseling and advice to their clients in order to help them gain money management skills that will help them recover from high levels of debt in the short term, and ensure their financial security over the long term.

 

To help their clients, credit counselors must first gain an understanding of the client’s overall financial situation. This includes determining their level of monthly income, the value of their assets, the amount of their debt, who the creditors are, what interest rates are applied to their debts, and so on.

 

Once they have gained an understanding of their client’s financial situation, credit counselors must help the clients determine a monthly budget, including a debt repayment plan, based on what they can afford to pay their creditors. Credit counselors also typically communicate and negotiate with creditors (and other relevant parties, such as banks) on their client’s behalf. 

 

 

Credit Counselor Job Duties

• Obtain information related to the client’s net monthly income, such as a detailed list of their expenses and sources of income

• Calculate a client’s net income by subtracting their monthly expenses form their monthly income

• Calculate how much of a client’s income they can afford to use for debt servicing

• Advise clients as to the most efficient and effective debt servicing options for their situation

• Help clients prioritize their debt loads

• Help clients develop monthly budgets

• Act as debt agent for clients and open an account in order to disburse funds from account to creditors

• Negotiate payment terms with creditors and courts, on client’s behalf

• Sort out practical repayment plans with creditors

• Gain the client’s agreement to a repayment plan

• Counsel clients on personal and family financial problems, such as excessive spending and borrowing of funds

• Keep client records in confidentiality

 

 

Experience Needed to Become a Credit Counselor

Although some amount of on-the-job training is usually provided, organizations that employ credit counselors typically prefer to hire candidates with at least one or two years of experience in a related field of work, as well as a bachelor’s degree in a related field of study. A related field of work could be considered any field that deals directly with financial matters or counseling, such as:

 

• Accounting

• Addictions counseling

• Banking

• Credit analysis

• Career/employment counseling

• Collections agency

• Financial planning

• Investment advising

• Marriage and family counseling

• Mortgage agency

• Real estate agency/sales

• Tax consulting 

 

 

Certification Needed to Become a Credit Counselor

You don’t necessarily need professional certification in credit counseling to be hired by employers. In fact, many credit counseling certifying bodies only offer certification to credit counseling practitioners who have completed a certain number of hours or years of service in the profession.

 

Achieving certification as soon as possible however, is highly recommended. It will showcase your professional competencies and greatly enhance your professional credibility with potential employers and clients, as well as creditors, funders, government and other stakeholders.

 

Certification in Canada

In Canada, not-for-profit credit counselors can pursue The Accredited Financial Counsellor of Canada (AFCC) credential. The AFCC program provides information in the areas of personal finance, consumer credit, money management and counseling. You do not need an undergraduate degree to pursue this credential, although it does cost over $1,000 to enroll.

 

With a significant amount of professional experience, Canadian credit counselors can pursue the Certified Credit Counselor (CCC) designation, which is recognized as the highest professional designation level available to not-for-profit Credit Counselors in Canada.

 

Certification in the United States

Certification for American credit counselors is generally offered by credit counseling professional organizations. For example, the Association for Financial Counseling and Planning Education (AFCPE) offers the Accredited Credit Counselor (ACC) designation.

 

Topics in these programs typically include:

 

• Principles of financial counseling

• Counseling skills

• Counseling outcomes

• Budgets and balance sheets

• Credit legislation

• Debt reduction methods

• Collection policies and practices

• Bankruptcy

• Mortgages

 

Success Tip: Even if you don't need professional certification to get a job as a credit counselor now, with the job market for credit counselors being as competitive as it is, having professional certification is a great way to ensure that you achieve long-term success by staying ahead of the competition for future job openings.

 

 

 

 

Who Creates Jobs for Credit Counselors?

Credit counselors are employed primarily by non-profit and not-for-profit debt management, and financial counseling organizations. Typically, these types of organizations are financially supported by government grants and corporate sponsorships, funding which allows them to keep their fees low enough for clients to afford their services.

 

Some credit counselors may be self-employed, although without corporate sponsorships and government funding their fees can become too expensive for clients to afford. Government agencies, as well as private for-profit financial planning companies may also employ credit counselors.


 

Credit Counselor Salary

The salary level of credit counselors can vary depending on their level of education, their level of experience, their level of certification, the region in which they work, and many other factors.

 

Credit Counselor Salary Alberta:* According to the 2013 Alberta Wage and Salary Survey, Albertans working in the Other Financial Officers occupational group earn an average of between $23.77 and $56.43 per hour. The Wage and Salary Survey also states that Albertans in the Family, Marriage and Other Related Counsellors earn an average of between $32.00 and $42.73 per hour.

 

Credit Counselor Salary Canada: According to Service Canada, the average salary level of Canadian workers in the Other Financial Officers occupational group is $62,107 per year. Service Canada also states that workers in the Family, Marriage and Other Related Counsellors earn an average salary of $48,347 per year.

 

Credit Counselor Salary United States: According to the United States Bureau of Labor Statistics, the mean salary level of American workers in the Credit Counselors occupational group is $44,960 per year.

 

*There is no reliable salary information available from reliable sources specifically for the career Credit Counselor in Alberta or all of Canada. We can however, get a good idea of what they earn by looking at the salary level of workers in closely related occupations.

 

 

Characteristics Needed to Become a Credit Counselor

In order to enjoy performing the duties of a credit counselor, you need to have certain personality traits. Taking enjoyment from your duties as a credit counselor is important, as it helps you maintain a positive attitude towards your work, which usually leads to having a long and successful career.

 

• A genuine interest in helping people to get their finances and their lives back on track

• Enjoy teaching and advising others

• Able to listen to people’s problems without judging them

• Enjoy gathering information and working with numbers

• Respect for private information; able to maintain client confidentiality

• Able to put people at ease and gain their trust

• Willingness to stay abreast of industry developments

• Willing to communicate and negotiate with creditors and the courts on clients’ behalf

 

 

Skills Needed to Become a Credit Counselor

In order to become effective in a career as a credit counselor, and perform your job duties with competence, you need to posses a certain set of financial, social and business administration skills. These skills are usually acquired as a result of your education, your previous work experience, and on-the-job training.

 

• Ability to work with numbers easily

• Able to prepare budgets and balance sheets

• Excellent listening and communication skills

• Knowledge of debt reduction methods, such as repayment plans and bankruptcy

• Knowledge of collection practices and policies

• Negotiation skills for dealing with creditors and courts

 

 

Credit Counsleor Jobs

Our job board below has "Credit Counselor" postings in Canada, the United States, the United Kingdom and Australia.

Careers Similar to Credit Counselor

Listed below are careers in our database that are similar in nature to Credit Counselor, as they may involve many of the same skills, competencies and responsibilities.

 

Budget Analyst

Career Counselor

Credit Analyst

Financial Advisor

Home Economist

 

 

References: Credit Counselor Career Information

Please consult the references below to find more information on the various aspects of a career as a credit counselor.

 

Alberta Learning and Information Service website: alis.alberta.ca

Association for Financial Counseling and Planning Education website: www.afcpe.org

Canadian Association of Credit Counseling Services website: www.caccs.ca

United States Bureau of Labor Statistics website: www.bls.gov

 

 

Scholarships for Becoming a Credit Counselor

Scholarships listed for majors that apply to becoming a Credit Counselor can be found on our All Scholarships by Major page.

 

Success Tip: Be sure to apply for any scholarships that you even barely qualify for, as there are millions of dollars of scholarships that go unused every year due to a lack of applicants!

 

 

Becoming a Credit Counselor: Applicable Majors

Studying one of the university majors listed below is an excellent starting point to becoming a credit counselor. Click on the links to find out what else you can do with these majors!

 


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