Looking to be happier with your life and finances in 2022?
The answer may be finding professional help.
People who worked with a financial advisor were found to be nearly three times happier than those who didn't, according to a study by Herbers & Company. Predictors of happiness such as feeling fulfilled, intentional, impactful and grateful were boosted in 66% of those who worked with a financial advisor, the study found.
In addition, those who sought professional help managing their money were happier in their relationships and communication, according to the study.
Those who want to get help with money management in the new year have many options when it comes to personal finance experts, including financial advisors, including coaches, therapists and more.
Some of these names for individual financial professions signal different types of education and regulatory oversight, while others may just be branding. This makes it important for consumers to know the difference.
"The demand and the number of people that are providing personal financial advice has just skyrocketed, as has the number of designations and certifications that exist out there," said Martin Seay, a certified financial planner and department head and associate professor of personal financial planning at Kansas State University
Here's what you need to know.
Names and titles
There are a few professional financial organizations offering certifications that hold individuals to a high level of training, testing, ongoing education and ethics.
CFP: One of the most well-known is certified financial planner, offered by the CFP Board. It's considered a gold standard, as it includes rigorous education and testing about many areas of financial planning such as retirement, investing, taxes, insurance and education. CFPs are fiduciaries, meaning they must act in their clients' best interest.
Working with a CFP is best for individuals with a solid financial foundation who are looking to build wealth, need life insurance or other products or are seeking investment advice. Many CFPs are also registered investment advisors, who can advise on investments and manage client assets.
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"You wouldn't be able to give any investment advice if they don't have that [RIA] designation," said Ashley Dixon, CFP and lead planner at Gen Y Planning, an Austin, Texas-based firm that works mainly with millennials, offering financial advice and managing some client assets.
AFC/ FFC: A certification that's growing in popularity is the accredited financial counselor, offered by the Association for Financial Counseling and Planning Education. Some AFCs are also financial fitness coaches, a certification that provides additional coaching skill-building. The AFC program includes personal finance education, testing, ongoing education and ethics requirements.
An AFC can help with budgeting, paying off debt, managing lines of credit or preparing for a financial goal like buying a house, making it a great fit for beginners.
"An AFC is kind of like a coach – we are going to meet you where you are right now," said Cait Howerton, an AFC, CFP and lead planner at Facet Wealth, a registered investment advisor in Baltimore.
Working with an AFC was a huge help for Madi Ciampi, 27, and her fiancé Andrew Papineau, 27, of Providence, Rhode Island. This year, they took a hard look at their finances and realized that they had some savings but weren't sure how to make their goals a reality.
In addition, Ciampi grew up around a lot of bad financial habits, she said, and neither received any personal finance education in school.
Through her job at a nonprofit, Ciampi met Susan Greenhalgh, an accredited financial counselor who runs Mind Your Money in Rhode Island.
Greenhalgh helped the couple lay out structured, clear, easy-to-manage goals, and filled in knowledge gaps they had, according to Ciampi. By working together, the couple was able to buy a house in November, three months ahead of schedule.
"There's no way we would have bought a house without someone walking us through the process," Ciampi said, adding that Greenhalgh was a rock star in helping the couple understand where they were coming from financially, how that impacted their goals and how to think long-term.
CFT: A certified financial therapist, or CFT, is trained by the Financial Therapy Association. Financial therapy weds mental health with personal finance, making it best for people that have behavioral or emotional hurdles that are impacting the way they use or manage money.
"It's not so much about technical advice as helping people get healthy with how they're thinking about money," said Seay.
Finding the right fit for your needs
To be sure, there are some people who will give personal finance advice or call themselves a planner or coach without having any training. Regardless of what title someone uses, it's important to ask about and look up their education, background and any registrations or certifications they hold.
"We do encourage consumers to look for someone who is committed enough to the profession that they get a designation," said Alan Moore, CFP and co-founder of the XY Planning Network located in Bozeman, Montana.
There are also limitations associated with different certifications; for example, a CFT, AFC or FFC can't give investment advice unless they're also a registered investment advisor.
"If you're not an RIA, there is no oversight or regulation into what you're doing, and that creates potential challenges for consumers," said Moore, adding that consumers can use the Financial Industry Regulatory Authority's Broker Check to find this information.
If you're ready to start talking about investments or need help making decisions about different retirement accounts, a registered CFP may be a better fit, said Adriane Ross of Clear Insight Financial Planning in Spokane, Washington.
Ross pursued her CFP after having an AFC to get more technical education and to be able to work with clients in more areas of personal finance, she said.
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Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.