I am in a mood to do a lot of True of False posts…hoping to get a better reader involvement!! It also helps that I need not sit and compose…i can write somethings at random and force you to think (I hope). Here are somethings that you may hear from a Financial planner (or may not)..so here it is:

1. A good financial planner should be able to improve the alpha in your portfolio.

2. The more a financial planner charges the better is the quality of his planning.

3. As life has got complicated financially you need a financial planner.

4. All financial planners have a well written down financial plan – created by A DIFFERENT PLANNER.

5. Most financial planners know fund management, taxation, personal finance, and enough law to make a will.

6. The bigger the written financial plan, the better it is for you.

7. A qualified financial planner knows more than an unqualified financial planner.

8. An IFA is not capable of creating a financial plan for you.

9. Your CA who files your IT returns is capable ย of making a good financial plan.

10. You are not capable to create your own financial plan.

11. A financial planner earns his fees only from you.

12. There is no conflict of interest in case of a fee only financial planner.

 

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  1. 1. A good financial planner should be able to improve the alpha in your portfolio.
    False. They should be able to contain folio volatility at nominal alpha.

    2. The more a financial planner charges the better is the quality of his planning.
    False.

    3. As life has got complicated financially you need a financial planner.
    False. Investing rules remain simple as ever.

    4. All financial planners have a well written down financial plan – created by A DIFFERENT PLANNER.
    False.

    5. Most financial planners know fund management, taxation, personal finance, and enough law to make a will.
    False. I would forgive them for this though. I notice many of them don’t understand basics of investment risk.

    6. The bigger the written financial plan, the better it is for you.
    False. Exactly the other way around. Which is why my Excel planner is a single A4 sheet.

    7. A qualified financial planner knows more than an unqualified financial planner.
    False.

    8. An IFA is not capable of creating a financial plan for you.
    False. They can, just that they should not if they are selling stuff.

    9. Your CA who files your IT returns is capable of making a good financial plan.
    False. The author is an exception.

    10. You are not capable to create your own financial plan.
    False. More than capable. All it takes is commonsense.

    11. A financial planner earns his fees only from you.
    False. Trail is the lifeline of most.

    12. There is no conflict of interest in case of a fee only financial planner.
    False. Not if the fee-only planner distributes via a relative!

  2. Responses:

    1. A good financial planner should be able to improve the alpha
    in HIS/ HER portfolio.

    2. The more a financial planner charges the better is the quality of HIS / HER CAR.

    3. As life has got complicated financially you need a ENERGY planner.

    4. All financial planners have a well written down financial plan FOR THEMSELVES.

    5. Most financial planners know fund management, taxation, personal finance FOR THEMSELVES.

    6. The bigger the written financial plan, the better it is for THE KABADI WAALA.

    7. A qualified financial planner knows more than an unqualified financial planner.

    8. An IFA is CAPABLE of creating a financial plan for HIM/HERSELF.

    9. Your CA who files your IT returns is capable of making a good financial plan FOR HIM/HERSELF.

    10. You are CAPABLE OF creatING financial plan FOR YOUR FINANCIAL PLANNER.

    12. There is NO conflict of interest in case of a fee only financial planner – HIS / HER PLANS WILL HAVE NO COMMON INTERSECTION WITH YOURS

  3. Rejoinder to Pattu…paper goes for correction tonight, you can reconsider the answers.

    Hint: Not all the answers are false ๐Ÿ™‚

    will post a rejoinder tomorrow…..afternoon…

  4. @Prashanth

    Financial planning does not ensure you are rich, it ensures your Planner ends up richer

    “when you want to have children, YOU have to do the work; Somebody else cannot do your work ” – common south indian village saying

  5. Ok, my attempt:
    1. A good financial planner should be able to improve the alpha in your portfolio. True.

    2. The more a financial planner charges the better is the quality of his planning. False

    3. As life has got complicated financially you need a financial planner. True, especially if you don’t have time or interest in understanding and challenging what financial salesppl say. Also, if you are confused between charity and buying financial products.

    4. All financial planners have a well written down financial plan โ€“ created by A DIFFERENT PLANNER. False

    5. Most financial planners know fund management, taxation, personal finance, and enough law to make a will. False

    6. The bigger the written financial plan, the better it is for you. False

    7. A qualified financial planner knows more than an unqualified financial planner. True (in terms of theory), practical wisdom is a different matter.

    8. An IFA is not capable of creating a financial plan for you. False. capable: yes; permissible: not sure

    9. Your CA who files your IT returns is capable of making a good financial plan. False.

    10. You are not capable to create your own financial plan. Depends on who the ‘you’ is. Most ppl don’t know what they know and don’t know.

    11. A financial planner earns his fees only from you. False

    12. There is no conflict of interest in case of a fee only financial planner. False, though materiality of conflict of interest maybe lesser ๐Ÿ™‚

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