Dear Sir, The article is really thought provoking and a mirror for many advisor who are in midst of going completely as per CFP Practice or by Tradition format. In all this confusion we normally forget 2 things 1.WHAT DOES CUSTOMER NEED ? For him/her Immediate Need is a Help /Assistance for his financial decisions and future safety. 2 Implementation.Many a times I have seen and also experienced if we start elaborating financial planning somewere down to core we forget about implementing the plan,we start loving the plan so much that rather implementing the plan we start do all the permutation and combination so as to present THE PLAN as our HERO,we again forget in due course that plan is not our HERO,but it WHAT AND HOW WE IMPLEMENT.. I follow that GETTING OUT OF FINANCIAL PROBLEM AND GETTING CUSTOMERS ON TRACK IS MY MAIN OBJECTIVE AS THAT HELPS CLIENTS TO HAPPY AND SAFE. Thanks for the brilliant writeup .

WE must be flexible if a walk in client are a called client is there we need not show our wisdom if a client really asks your advice or if you made intimacy with client than we can speak some thing for him

Financial Planning is undoubtedly a best tool to any individual but most of them does not understand its intricacies and have a desire to understand. I my self had devoted a lot of time and spent a lot of money in getting certified myself as CFP from FPSB India. Now, SEBI says that one needs to get registered with them as INVESTMENT ADVISOR else he cannot practice advisory anymore. So, all my efforts, time and expenses have been negated by SEBI. Recently, SEBI has punsihed some IFA for this offense too. As of now, though I possess the skill of financial planning, I am not interested to invest further in the purchase of expensive software that too when investor is not willing to pay any thing for the rendered services and CFP certification is not approved by SEBI. There are other hurdles as well/

Mr. Somasundar. HNIs need financial planning or Good advise AS MUCH AS RETAIL INVESTORS. 90% of HNIs are not aware of financial planning. Many HNIs are lured into fancy products (structured products, products with options) which have ultimately delivered returns poor than Bank FD ! There are many foolish HNIs who invest Only in Real Estate and Gold ! Be confident and take the next HNI client head on.

The Entire discussion was well thought out and expressed. Thank you. I agree that the Aam Aadmi has to be made comfortable first.Empowering the common man through Equity investing should be the primary goal. Slowly the retail investor can be taken to full Financial Planning stage.

Dear Ashish, Talking about the practicality of the financial planning and coming out of the bookish knowledge. Actually it is to be used as a tool for the investors benefits. Simple things first -making the habit of savings. Well said and actually you are implementing as well.

WELL SAID. IF WE GO THROUGH THE PLANS AND EXECUTIONS IN THE PAST 4-5 YEARS OF SOME CLIENTS; SOME CLIENTS MIGHT HAVE EXITED THE FINANCIAL PLAN GIVEN BY FINANCIAL PLANNERS; AS THEIR GOALS ACHIEVING TIME HAS CHANGED QUITE A BIT BECAUSE OF THE MARKETS AND HIGH INFLATION ENVIRONMENT; AND PEOPLE MIGHT FEEL THAT THIS IS ALL A PROFESSIONAL WAY OF SELLING MUTUAL FUNDS AND NOT ANY OTHER THING. ATLAST WE ALL SHOW ONE PRODUCT MAJORLY IN THE FINANCIAL PLAN AND PEOPLE GET INTO HIGH THINKING WHAT WILL HAPPEN REALLY; AND THIS HAS BEEN SEEN IN THIS PERIOD ALSO. SO BE COOL; STICK TO THE BASICS AND GO ON;

Dear Ashish , Dear Manish, Very practical and very insightful. Its very challenging for youngsters entering the profession to strike right balance between what their books and exam courses tell them vs what they will face on the ground. I specifically appreciate the point on writing elaborate plan and then expecting a client will have different pots of money for each objective and the advisor will monitor and calibrate the journey for every pot. Quite an arudous task! Everyone needs to read your article. Only if they read it, they will realise life is never black or white, only varied shades of grey! Very well written, excellent piece!!!

Approach is very practical sans the baggage of idealism. In a country where Equity market at large is still perceived to be a Snakes-and-ladders game and MF is looked at its disguised avataar, we need to tread gingerly to get attention in the first place. Once the client tastes blook and has internalized the basics of investment, we could take him to the next level. Nice analysis thanks Ashish and Manish!

You said it all......,

At last, somebody had the guts to speak the truth. The true friend of the investor is the one who converts the expenses to savings and lead him the path of financial security. Not one who will tell him about the few crores he will need to retire, and put the fear of God into him in order to lure him into mutual funds. This is the ultimate form of mis-selling. The HNIs need no planning. The middle class is the one who need financial security. This is a simple simple profession and let us keep it that way!

Simply superb with too deep analysis on retail clients. What are the bigger part most of IFA missing out in their practices.

Bingo! Dead on target with first invest safely and then wisely. Absolute need of the hour. Keeping it simple.

great Job Ashish Ji I am fully agree with the comments of My friends, We should always focus on the worthiness of costumers . Instead of selling our focus should be on advising sooner or later customer will definitely recall our words of advise and act accordingly

Planning is always important in everything.. but excessive planning and excessive fear lands nowhere..Well done Ashish ji.. very practical view..

Suddenly every one is talking about a middle path a balanced approach, speak to newly passed out financial Planners who have no idea about how things work on the ground,the only thing they can do is write a Plan based on excel sheet calculations and forward looking projections. Criticizing ALL Lic agents, ALL MF distributors seems to be their birthright, to be RIGHT about everything they say, after passing out with ONE exam! Everyone else is a Mis seller or a cheat because he is getting Commissions from the Manufacturer, or selling NFOs! everyone should go direct and pay the Advisor, which is the only correct path for investors going forward!

Dear Ashish Bang on!! When dealing with retail investor, we have to be a mix of distributor and a financial advisor, or I call it as DISGUISED FINANCIAL ADVISOR. In true sense of financial planning, we cannot handle more than 100-150 families and thereby putting a halt on scalability. We should be a true guide to them and assist them in doing better investment and planning. But I believe, in times to come, we will have tools to do even financial planning as well in retail side.

First one has to decide whether he wants to distribute or advice.In advice unless the trust is not build you cannot scale up. But in my understanding no CFP will tell his clients to take high risk to achieve the goals when his risk appetite is low. Moreover the regulation says you should do risk profiling. If your conviction level is low better look for Rs 3000 to Rs 5000 SIP. But if you believe that by doing at least basic financial planning you can suggest asset allocation and all the 5 SIP will not be in equity, it may spread from equity,balanced fund,MIP,Dynamic bond,gold ETF and so on..... Unless one is not sure what his business model,CFP tag is not necessary. But if you love the profession and ready to grow with the client then Financial planning is the way forward.

Great insight! It can com only from Ashish and Manish, who have in-depth understanding of customer behaviour and how to build a sustainable and scalable retail business. Keep it up.

Ashish, excellent article based on practical ground realities. A financial planner need not start the client relationship with comprehensive planning, instead get started somewhere with small actions, make clients comfortable which eventually can lead to comprehensive planning and wealth management services. And a holistic approach is beneficial to both advisors and clients. Every advisor need not aspire to scale up advisory practice. This is matter of individual preference. Many advisors can stick to 50-150 financial planning clients and offer full range of products and services to them. The income will grow as the clients wealth will grow and also due to your ability to charge more as your experience grow. I think financial planning is a great model to be a financial advisor who is an independent, a professional, earn a respectable income and is respected in the society. This has its limitations in scaling up the practice but then Scale is a matter of individual aspiration.

Ashish Wow, couldnt have articulated it any better,you have said it in very simple words. There is nothing wrong in Financial planning but believing that it is the gospel truth and that and only that is the right way investors can create long term wealth is totally wrong. welcome to the real world guys, The Indian housewife has been the pioneer of the SIP concept saving small amounts in gold and RD since ages, the Savvy but un-educated and un informed investor has been saving in all the right asset classes(read RE) and creating wealth the way he thinks is right and not what a Planner who charges fees and tells him what to do. Try planning for a goal by asking a customer to start an SIP of 1,50,000/- for retirement, give me a break, this guy has a savings of only 25,000/- a month, this works in excel sheets only not in the real world. A balanced and a client centric approach as you have said is I think the correct middle path. Superb

I started reading the article with a negative mindset, especially because of the controversial Title. But, boy, am I stumped!! You are absolutely right. Teaching clients is right but are they ready? And, yes, your approach is very practical and very much adaptable. Highly appreciated. A Big Thanks!!!

Excellent Article

Such article comes out only when one has years of experience. Great sharing. This is also an important subject for AMCs. Some AMC genuinely spend good amount on Distributors knowledge enhancement. They can draw a program for IFAs: "Balancing between Financial planning and financial products selling. I think it will be a great help to industry.

In my limited understanding this is an extremely simple business complicated by greed /fear , no education is needed whatsoever, I have clients who have zero financial literacy academically and are wiser than the smart, high powered institutions with compliance, risk management departments who have rigged up LIBOR, gold prices, lent money in American MBS. Yet its good to be planned, acdademics will help but it gives a false sense of cockiness which markets will destroy. My camp is in the centre as I have learnt my stuff at the feet of mentors.

Dear Ashish as always thought provoking article.I am in sync with your observation . 1) At FIINFRA we ve written more than 10,000/ plans and our experience is Clients are very keen to share data over time 2) Also I agree with you Data based approach help you scale up your business in controlled manner Regards

A contrarian thinking but very practical. I agree with the Goel brothers that the client behaviour is more important than just goal planning. Investor management is more important than investment management.

Very nice article . Right way to aapproach an investor

Great !! Advisory Simplified !!

Thought Provoking article....