Yes. Depends of if you have a Mac or PC. If you have a Mac you can use Garage Band and iTunes to convert mp3s to ringtones. Garage Band is way easier though. You can look up a tutorial on CNET.com. If you have a PC you can try the iTunes way or do a Google search.
I haven't done it in like a year or so, but it's fairly easy in Garage Band if you have a mac. I made a couple of my own custom ringtones. When you're done with your project in GB, you just upload it to iTunes and create your ringtone. It's not that hard, just get crackin', you'll figure it out. If you're on a windows machine, I personally don't know of any other software that will help you achieve this. I would think there's gotta be something out there though for that side of the world....
I am not sure if by "personal" you mean 'Custom' ringtones or a dedicated ringtone per contract.
If you want custom ringtones, i use audiko.net/, it's Free and supsr easy to use, it will make any song and audio file into a ringtone (you can edit and pick wha part of the song to take) all in a webtool. then download the m4r to itunes and done.
If you want personalized ringtone for contact, just go into the contact and click edit and add the ringtone to the "ringtone' Field