One of the most important things I HAVE to do while training Relationship Managers in banks is to keep reminding them that they are not:
a. Fund Managers nor are they b. Financial planners.
The roles of each person – inspite of some common areas – is vastly different. Similarly another worry is – the financial services industry would like to tell you that financial planning is very complicated. However there are some websites telling you that things like Retirement planning is simple.
The truth lies somewhere in between. Manish Chauhan who runs jagoinvestor.com has done one article saying ‘6 steps to retirement planning’. Sorry Manish Retirement Planning is not so simple. Frankly I do not think, ANY Financial Planner in India has applied his mind to volatility effects on the retiree’s portfolio. Monte Carlo analysis is necessary – especially for smaller portfolios. The fact that there has even been a Nobel prize for managing volatility shows how complicated life is.
Completely on your side if you tell me that such service is not available in India. However if a person with a small portfolio were to try to manage it himself, not understand power of attorney, not know how to lock in small annuities regularly, create a bank FD ladder – or a single premium pension plan ladder, – apart from the usual investment basics, HE CANNOT DO FINANCIAL PLANNING.
After completing my book I have realised that a step-by-step manual, a series of programs, CDs with simulation exercises…are all necessary if somebody was serious enough about retirement.
For Manish of course retirement is about 50 years away….:) so it may not matter NOW.
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