Jump to content

Draft:Psychology of financial planning

From Wikipedia, the free encyclopedia

This is a new area of focus for CFP(R) professionals. Please add content.

Introduction

Psychology of financial planning is the study of the financial planning process. This includes the interaction of the client and financial planner during the planning process.

History and Development

Origins of the Concept- early roots in behavioral economics/finance, Richard Thaler [1] nudge theory, intro of financial therapy 2000s, money scripts, incorporation into financial planning recognized as distinct subfield, emergence of certification/training (CFT, ABFP, Texas Tech offering graduate coursework/programs for financial planning students), FPA endorsing integration, in 2020 CFP board officially included psychology of financial planning in 2022 exam.

Key Contributors

According to Google Scholar, the top producing researchers of psychology of financial planning based on their h-index and focus areas of "psychology of financial planning" and "financial therapy" include Sonya Lutter[2], Victor Ricciardi[3], Kristy Archuleta[4], Brad Klontz[5], Joe Goetz[6], Megan McCoy[7], and Bruce Ross[8].

Core Principles and Concepts

Money Scripts (avoidance, money worship, status, vigilance) & financial flashpoints

Potentially seen as negative orientations toward money except vigilancee” which could be seen as vigilance as financially healthy, but not supportive of well-being Financial Behaviors-emotions and money Cognitive Biases in financial decision-making

Money Disorders

Behavioral Finance (see also Behavioral Economics) vs. Psychology of Financial Planning Compare and Contrast Differences between psychology of financial planning, financial therapy, behavioral finance

Role of Financial Planners

Differences between CFP, CLU, CFA, PFS CFP - The Certified Financial Planner certification is a professional certification mark for financial planners conferred by the Certified Financial Planner Board of Standards (CFP Board)

CLU - The Chartered Life Underwriter designation was established by The American College of Financial Services

CFA - PFS -

Educational and Certification Programs/ Professional Organizations

Educational/certification programs Requirements to be an educational/certification program CFP CLU CFA PFS

Professional organizations CFP Board Financial Planning Association CFA Institute AICPA - PFP Division

Seeking Services

Criticisms and Challenges

ack of Standardized Training and Certification/ Role Confusion

Ethical Considerations

Quantifying Success and Measuring Outcomes

Client Resistance

Limited Research

Cultural/Societal Barriers –what may be seen as unhealthy financial behavior in one culture may be desirable/normal in another.

Future Directions

Financial well-being/wellness

  1. ^ https://en.wikipedia.org/wiki/Richard_Thaler
  2. ^ "Sonya Lutter". scholar.google.com. Retrieved 2024-10-30.
  3. ^ "Victor Ricciardi". scholar.google.com. Retrieved 2024-10-30.
  4. ^ "Kristy Archuleta". scholar.google.com. Retrieved 2024-10-30.
  5. ^ "Bradley Klontz, Psy.D.,CFP". scholar.google.com. Retrieved 2024-10-30.
  6. ^ "Joseph W. Goetz". scholar.google.com. Retrieved 2024-10-30.
  7. ^ "Megan Ann McCoy". scholar.google.com. Retrieved 2024-10-30.
  8. ^ "Donald Bruce Ross". scholar.google.com. Retrieved 2024-10-30.
Retrieved from "https://en.wikipedia.org/w/index.php?title=Draft:Psychology_of_financial_planning&oldid=1254389355"