When you go to a financial planner you have some expectations, do you not? Let us see what are the legitimate expectations that you can have:

– he should be able to articulate your goals more clearly.

When you say “I want the best education for my daughter” he should be able to translate that to “I MUST have enough money to be able to send my daughter to an Ivy League college in the year 2022 and I expect that to cost about Rs. 2 crores”.

-he should be able to draw up a) your balance sheet as on date

b) your cash inflow and outflow statement

c) your goals statement translated for all financial nos.

then he should be able to sort out the MUST do goals, NICE to do goals, and then the others.

– he should be able to arrive at the appropriate debt equity mix of asset allocation for you to achieve your goals

-he should be able to bring out the MISSING goals. For e.g. if  YOU are allocating Rs. 2 cr0res for your daughter’s education, it cannot Rs. 3 lakhs for her wedding. You obviously have to provide for your OWN retirement…etc etc…

– explain the advantages of borrowing to buy a house or buy a car

-explain the advantages of buying a house or renting a house

-explain the NEED to increase YOUR knowledge, especially if it involves some direct equity investing

-explain the conflict of interest in advising and selling (if he does not please ask him or her)

help in making the will, investment philosophy statement, investment diary, creating a ‘hand over’ document – what happens if YOU dropped dead?

etc etc etc……………….

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  1. After recent plunge of Asahi, Opto, HDIL and NHPC and with Sathyam and SKS episode some time back , it is tought to trust Indian businesses. I don’t get an inspiration that many of the NBFCs and Banks do not pass on the interest rate cut benefit to customers. Too many charges are loaded in the BFSI space and not talk about misselling and poor redressal system.

    Few Indian businesses have professional managements and most are passed onto next generations as like proprietary. The Management quality, ethics and values are too less and for most of them, share holders comes last in the line.

    Many of the previous peaks of Indian stock markets are saddled with corruption and manipulation. I say it very confidently today that there are very few businesses in India that are doing business in legal and ethical manner. Unfortunately these stock prices are either not cheap or they do not show spectacular Indian performance which expects company to grow 50% per annum forever.

    Given the daily infra problems and job demands, there is no way an ordinary employee can ever learn about Indian stock markets. If learns about it, he will be away from the market forever with disgust.

  2. Hi Subra – Nice post. It contains an excellent checklist to ensure all major boxes are ticked when it comes to financial planning.

    I have a topic suggestion for the wealth book you are writing – ‘Equity investing for a large portfolio (Read more than around 2 Cr)’. I have noticed in the last few months you have advocated direct equity investing in favor of active MFs due to various sound reasons such as costs and dividends. Doing this however is quite difficult. If could cover guidelines (How many stocks to diversify, how to monitor etc.) to doing this, it will be immensely useful.

    If you would like to do this sooner in an abridged fashion on your blog, even better 🙂

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