Financial Advisor: Role

Financial inclusion, Financial Advisory, Financial planning, Financial planner, Financial literacy….vow these are the catch words today is it not? And all the financial product manufacturers, bankers, websites, etc. are now getting into all of these in some form or the other. It is politically a great sales pitch. However it reminds me of an English case where a Company meant to protect the cyclists wanted to change its objective to include motor car owners too! The Court said “you are supposed to protect the cyclists from the motorists” ha ha ha!

Now a big financial player has got into financial planning. Knowing their attitude to financial planning as a group this was a joke – and a cruel one at that. So I called somebody there. He said “The client has to end up buying some product – so the question asking has to be tweaked”.

Let us take a typical conversation.

FP: Sir as per our software you have an income of Rs. 2.3 crores a year. So you need Rs. 23 crores of life insurance. You have only Rs. 4 crores of life insurance,  so please take a Rs. 19 crores for the next 17 years.

Client: But my son is already in a job and my daughter is 2 years from earning. I have already paid for their college fees. My wife earns about Rs. 45 lakhs and is likely to be employed till her age of 65 years.

FP: Still sir, our software says your life insurance should be 10 times Minus existing life insurance….

Client: Let me speak to your boss.

Boss: Actually sir you can reduce your liquid assets also. So in your case the insurance required can be reduced by Rs. 22 lakhs lying in your liquid fund.

Client: That money is to pay for my daughter’s term fees, so next week it will not be there.

Boss: Sir why do you not insure your children and your wife for some life insurance. Looks like you do not want to take any life insurance for yourself.

Client: Let them do it when they want, I am not doing anything of that kind. My friend has actually asked me to surrender my wife’s life insurance policies and put that money in direct equities. He says nobody is dependent on her,  so any policy on her name is a waste. I also read this in a website.

Boss: “#$%^&*(” the websites and blogs sir. Anyway we are launching a NFO in our mutual fund will you be interested?

If this is financial planning, SEBI should put a ‘Buyer Beware’ board…at least smoking kills only you. This kind of FP can ruin your wife’s retirement, your kids education,..and your own retirement.

Client’s parting shot to the Boss was good. He said show me ONE senior executive of your organisation who has a Rs. 2 crore salary and a Rs. 20 crore life insurance…preferably a unit linked plan. LOL.

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3 Responses to “Financial Advisor: Role”

  1. hehehe

    Good one 🙂 . inspired by the humour I see on this blog, I recently wrote an article on my blog . May be you like it

    Why it makes sense to Kill yourself If you dont do your Financial Planning :


  2. Nice article.

    how much worth of life insurance is really required?

  3. is the financial services business dependent upon keeping the client ignorant. Are they worried that someday the clients may actually wake up?

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