Portrait of Fiona Guthrie standing in her garden
Portrait of Fiona Guthrie standing in her garden

Financial counselling explained (and how it can help)

Driven by the belief that everyone deserves a fair go in life, Financial Counselling Australia’s chief executive Fiona Guthrie is passionate about helping people overcome financial difficulty.

Here, she talks to us about ‘good’ money management and introduces the idea of financial counselling... who it can help, when it might be called on (any time), how you can access it and what to expect when you do.

Firstly, what does ‘good’ money management mean to you?

One of the things that makes me pull my hair out is hearing that people just need to ‘manage their money better’, and then they wouldn’t get themselves into financial difficulty. Nothing could be further from the truth.

Many people on low incomes are fantastic money managers. They have to be. The problem is that they just don’t have enough money in the first place. Also, bad things happen to good people. If you lose your job, or get sick, or your relationship breaks down, it can have a huge impact on your finances.

The way many of us think and talk about money points to a fundamental problem in our society. Often, it’s seen as a personal failing to experience financial hardship and we don’t talk about it to others. Money is still such a taboo subject, but it would be far better if we could be more open with each other.

Furthermore, ‘managing money’ isn’t as easy as a lot of people think. Credit cards for example are particularly tricky products to manage well. Lots of small purchases spread over a month – it’s no surprise that sometimes you get a bill that you just didn’t expect.

Personally, I’m not either particularly good or bad at managing money. I’m just average. Like most people, I’ve made mistakes and spent too much sometimes, or bought something I didn’t really need. I’m lucky though as I have a steady income. So, if I slip up a bit, I can recover and try to not make the same mistake again.

What exactly is financial counselling?

Financial counsellors provide free, confidential, and independent advice to people who have money and debt problems, so that they understand their options and get back on track.

Financial counsellors are trained professionals and they work in not-for-profit organisations. They differ from financial planners and advisors in that they don’t lend money or advise people how to invest.  

In your experience, what type of people are drawn to being financial counsellors?

People who want to make a difference. Financial counsellors come from all walks of life, ranging from financial and social services to the law.

I describe the role as ‘walking beside’. That means not telling people what to do – people are experts in their own lives after all. They just need access to the right tools and information so that they can choose the option that works best for them.

People who choose to work in financial counselling need to be respectful, non-judgmental, and empathetic. They also tend to be incredibly passionate and never give up – they will go the extra mile for their clients.

Who can benefit from seeking financial counselling, particularly given the various impacts of the COVID-19 pandemic?

Anyone who is worried about money and making ends meet can benefit from financial counselling. There are thousands of Australians at the moment who are worried about the future or struggling with current bills and debts.

There’s nothing to lose in just picking up the phone and making that call.

How can someone get in touch with a financial counsellor, and does it cost anything?

Financial counselling is always free, and the easiest way to talk to a financial counsellor is to ring the National Debt Helpline on 1800 007 007.

If someone says that they are offering financial counselling and want to charge for the service, in all likelihood they are breaking the law. Stay well away!

And in a practical sense, what might they expect when they first reach out?

A listening ear, sensible advice. What a financial counsellor does is find the pathways through what can seem like an overwhelming financial situation.

Many people can self-advocate once they understand their rights. For others, a financial counsellor might provide more assistance, for example, help with contacting creditors directly, or lodging a dispute with an external dispute resolution scheme, or contacting Centrelink.

How important do you believe financial wellbeing is for our mental health?

Financial wellbeing and mental health are two sides of the same coin. We know that financial stress causes mental health to deteriorate and vice versa.

One of the key indicators of financial stress is worrying about money issues at night, therefore it interrupts your sleep. Sometimes people may not consider this financial stress, but that is what it is. It’s just so important for people to know that help is out there.

Can you give us an insight into some of the feedback you’ve received from people who have used a financial counselling service?

Financial counsellors get amazing feedback from their clients – lots of gratitude and thanks. People feel that a weight has been lifted off their minds. Some people say: ‘I wish I’d known sooner’. But mostly they just say: ‘thank you'.

Often people feel that there is no way through. But in fact, there are always options. It is empowering to know that you do have choices.

My children used to think I was being melodramatic when I said that financial counselling saves lives. But it does. There is no doubt that some people can find themselves in a very dark place and feel there isn’t a way out. But there is.

This article was created as part of a collaboration between Beyond Blue and Financial Counselling Australia looking at what people can do to support their financial and mental wellbeing. You can find more information here.

For practical financial tools, advice and resources visit: moneysmart.gov.au.

To learn more about free financial counselling go to Financial Counselling Australia. Financial counsellors give free, independent, and non-judgemental advice to help people get back in control of their finances.

If you, or someone close to you, are in financial difficulty contact the National Debt Helpline, which offers free professional advice and does not lend money or advise people how to invest.

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