Let us say you are a HNI and looking for an adviser. Do you really want to look at a low end IFA who does an average SIP of Rs. 4000 per month? When you are talking of doing an SIP of Rs. 200,000 a month?

Or When you are looking to fund your child’s education in India with a struggle do you want an IFA who is trying to tell you why your daughter should study in an IB school and how it will prepare her for an Engineering degree in the Imperial College UK?

Both may be extreme cases, but like a marriage you are much better off if your IFA can speak your language, live in your locality (or your kind of a locality), drive a similar car and have similar aspiration. You are also going to look at somebody with experience of dealing with people like you. If you are a Vee Pee in a bank or a merchant banking outfit, it is nice if his other clients are also in the similar ctc, educational background, etc. Many readers get back saying ‘hiring an adviser is not necessary’. I disagree almost violently. A good IFA can add a lot of value to your understanding of Asset allocation, risk, insurance, staying calm in times of stress, teaching you how to do estate planning, take medical insurance, retirement planning, inter generational money transfer, money communication, etc. Looking for and Locating such an ifA is not easy, but more than worth it!

Once you locate such an IFA it is time for you to be objective while doing his or her assessment.

Ask him how was he investing his own money in 1999 right upto 2002.

  • how were you investing in the markets in 1999, 2001, 2007, 2008, and 2011.
  • how did you help the client to hold on during the boom of 2003-7?
  • what changes did you make in the portfolio in 2007? 2008? and 2012?
  • at current pe what is the expected return on equity and on debt?
  • PERSONALLY where do you invest?
  • do you yourself do a sip?
  • how do you assess risk? can you share the procedure?
  • how much of your portfolio success is luck and how much is skill?
  • at your networth you do not need equity at all?
  • why do you have equity when clearly your GOALS can be met by a less volatile asset class?
  • why do you have so much debt assets when inflation is rising?
  • Why do you have so much equity assets in an economy where interest rates are so benign?
  • What percentage of your business will I be if I were to bring my Rs…to you for managing it for me?
  • How much do you want to grow? Do you still have an appetite for growth?
  • How many clients have left you in the past? why?
  • Do you give up clients when the ideology does not match?
  • In your own portfolio name 3 favorites and tell me their story
  • Do you really deep dive into your investments or are you dependent on outsourced research?
  • How do you define risk and what risk do you think is there in my existing portfolio?

Sure you cannot ask all the questions in the first meeting. Sure you will take time understanding the answers, but do take notes.

Words you do not want to hear: market timing, FnO strategy, proprietorial trading algorithms, btst (buy today sell tomorrow), technical trading calls, leverage, gold back borrowing, etc.

What you want to hear: I got lucky, I made mistakes, yes lost clients to competition, lost clients who did not understand why I was sticking to the same fund, no I did not (or I did) make attempts to bring back the same clients…..

PS: this is a general gyaan session, AND I AM NOT LOOKING FOR INVESTMENT CLIENTS.

I ONLY DO LECTURES FOR SELECT AUDIENCES ONĀ 

a) Goal based Investing

b) Retire Rich Invest Rs. 40 a day and

c) Wealth prescription for doctors.

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