Learn a few words here and there – let me help you:

– start early, compounding, equity is for the long term, FMP is better than bank fixed deposits, Debt funds are more tax efficient, exhaust your PPF limits, buy only term insurance (but please buy endowment plans from me, because they are not unit linked!!), ……….etc.

then use some more jargon – asset allocation, you must have gold in your portfolio (if they are stock brokers, ¬†gold ETF), real estate is a must (especially if they have a tie up with a builder or a bankster) …

and of course – today you must have a website.

Lo and behold they become a financial planner. For a common man who is hearing these terms for the first time and too damn lazy to even scratch the surface, these sound like words from heaven!!

So here is a financial planner who is expected to deliver you from ……well from Deliverance is Deliverance right!!

So just say Hallelujah and be happy. Why if you are even more happy say Dayenu!! After all what more can you want.

Of course you will end up paying a fee of Rs. 5000 to about Rs. 35,000. And there is nothing to say cheaper is better or more expensive is better. Many of them will of course sell you enough products to make sure that they make money out of the transaction.

This post is just to say that Caveat Emptor is applicable even when you buy financial services like financial planning or insurance advisory. There is no way, no way, no way to know who is a competent financial planner….but ask yourself the following questions:

1. Does he ask me the tough questions?

2. Does he look at me as if I have committed a crime if I suggest something to worsen my 80% in Real Estate current situation?

3. Does he have working knowledge of the financial services industry from close quarters over the past few years?

4. What is his own asset allocation (this will show his bias) – for e.g. if you meet me YOU SHOULD KNOW that I have a huge equity bias…BUT…I have an adequate debt base to say so!! lol

5. A planner who is not experienced, or well trained or well qualified is very likely to forget (or not know) history or bias. This could hurt and hurt badly.

6. Ability to hold your hand when the asset allocation is being tested severely. Imagine being able to hold on to a client’s SIP when the index came from 21k to 9k or even worse! During violent market movements, keepin one’s cool is not easy…..

..and so on…


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