It’s Time to Get Yourself a Financial Guardian

There are moments in life when you are offered two paths. The first is crooked but easy, the one most choose to follow… and the other may be a path less travelled, punctuated with cliffs and valleys: a path of honesty that very few want to follow.

The choice is yours…just like it was ours 15 years ago.

In the late 1990’s many companies entered the financial services sector to sell either insurance or mutual funds – but not many may have focused on the mandate to serve in the best interest of their clients.

PersonalFN was founded in 1999 fueled by the ambition of empowering Indian investors to make better investment decisions. Built on the cornerstone of honesty, integrity and competence, PersonalFN successfully guides investors in their journey to financial freedom in an unbiased and transparent manner.

Amidst the organized mis-selling by many players in the financial world, PersonalFN has spent over 15 years educating investors and has established a loyal following with the support of tens of thousands of valued readers like you. Yet in our interactions with the clients and readers, we have found one common dilemma…

Unethical Advice!

Now, there are people who – while driven to earn a quick buck – give in to ‘making it’ by adopting unethical means.

Here’s a case of one of our HNI clients, Mr Kanan (name changed) who had been actively taking advice from his bank relationship manager on money matters, which also included maximizing returns on money lying ideal in his premium banking account. Mr Kanan lost trust in his relationship manager when he realized that he was short of the money needed for his daughter’s higher education. This was something that Mr Kanan had planned 5 years in advance. However, the lack of knowledge about investing had forced him to place his trust in the hands of his relationship manager.

The relationship manager had suggested investment products without completing a risk profile of Mr Kanan and without fully understanding his investment objectives. Predictably, most of Mr Kanan’s investments were made in fancy NFO’s and ‘structured’ products which paid high commissions. Additionally, the relationship manager actively suggested churning the portfolio to ensure that the relationship manager kept earning more commission income and met his business targets.

The relationship manager convinced Mr Kanan that it was really important to get strong returns – and one way to ensure this was by shifting money in equity mutual funds that took excessive risk to generate higher returns. This was very unethical as the recommendations made by the relationship manager were driven by hefty commissions paid by the NFO factories. Moreover, some of Mr. Kanan’s investments were not in line with his investment objective and time horizon. Ideally, one’s savings should be allocated to those investment products which are in line with their risk appetite and time horizon. All these factors were clearly missing in Mr Kanan’s case-and that cost him a fortune.

Mr Kanan trusted the relationship manager and thought that the advice from his relationship manager would be good for him. But the huge losses suffered during a recent market downturn completely caught Mr. Kanan off guard!

There are many Mr Kanan-like stories in India – you read about them in the press or you hear about them from friends and family members.

This is not to say that unethical advice is given only by relationship managers working for a MNC bank. Vested advice may also come from mutual fund advisors / distributors, insurance agents, stock brokers, financial planners – or websites that are targeted towards those looking for alternatives. And it is also not true that all relationship managers are out to mis-represent their clients and only focus on the commissions paid by the manufacturers. But it is fair to say that investors need to be careful.

PersonalFN wants to solve your problem of finding a person you can trust. While there are many certifications and requirements set by regulators and industry bodies, it is unfortunate that many financial advisors have resorted to suspect practices while advising on personal finances. To curb such practices, PersonalFN is creating a group of individuals that are ethical and competent in their dealings with clients. And we will introduce this group of individuals to you!

There is a genuine demand from investors for authentic, independent, and unbiased advice on all aspects of personal finance.

PersonalFN has, in the past, launched various services backed by unbiased views and honest opinions.

And today, PersonalFN brings the first-of-its-kind exclusive endeavor that can get like-minded advisors and investment professionals together and place them at the forefront of the financial advisory industry.

PersonalFN is glad to launch, an exclusive platform of advisors who want to become a financial “guardian” for lakhs of investors like you: investors who may have been misled and exploited by unethical advisors.

A Certified Financial Guardian will be a symbol of honesty and commitment towards the interests of investors and help build a long-lasting and trustworthy relationship between those who have the savings and need investment advice – and those who can offer it.

In an ocean of rampant disappointment and extreme distrust, a Certified Financial Guardian will be among the chosen FEW whom you could meet and place your trust in with a high level of confidence.

Do not forget, every investor needs a guardian today, so make sure you hire your Certified Financial Guardian.

If you are an investor and need a Certified Financial Guardian to contact you, please click here.

If you are interested in achieving the status of a Certified Financial Guardian and working towards giving your clients honest, professional, and competent advice, please click here.

“Your Prosperity is our Goal”: Mr Sushil Sabarwal

“Your Prosperity is our Goal,” is the motto that defines Mr Sabarwal.

Offering services from creating a mutual fund portfolio to asset allocation, he goes a step ahead to help clients with their financial goals through retirement planning,amongst a host of others.

He vows not to leave you in the lurch. “Being Accessible& Available,” is what he promises to his clients. He proactively shares policy changes such that the clients can implement in the restructured plan.

Mr Sabarwal has created sound processes and programs that help him to serve his clients better. “Through our well-managed wealth creation program, we have helped hundreds of our clients by dramatically reducing the mortgage terms through best realising their goals,” he proudly says.And to compliment this, he has a vision to “to improvise a client’s financial wellbeing by underlying those investment plans that turn their desired goals into reality”

With over a decade of experience, he is serving multiple family generations. This alone speaks a lot about his commitment to serve clients and the trust generated over the years. His strong adherence to ethics is what made him take up the CFG course, to offer the best practises and transparency to his clients, while offering the best support and services.

Mr Sabarwal is a part of theNetworkFP& FIFA group, which are associations of financial planners and financial advisers. This helps him to keep abreast with developments in the financial services industry. This ensures you get the benefit from the latest and best practices.

He loves reading Robert Kayosaki.Kayosaki’s book, Rich Dad Poor Dad is his favourite.

He admires Amit Trivedi, Gaurav Mashruwala andKeyur Shah, who have contributed immensely to the financial planning domain.

His advice to investors is: Have trust & faith in your advisor, riding the sea of investment planning and financial goals achievement’s cannot happen without a financial advisor.

Mr Sushil Sabarwal can be reached here

Why Financial Guardians Shouldn’t Ignore Investor’s Needs

But if financial (investment) advisors follow high fiduciary standards and put their client’s interest at fore at all time, RESPECT and TRUST can be earned.

But financial advisors directly jump to the last step—offer a solution (financial product) without understanding the client’s outlook. This approach results in a fractured relationship. 

By failing to understand a client’s needs, you risk the following:

Losing the client, credibility, and trust– What would you do if a doctor recommends a medicine to you without an examination? Would you be comfortable to take the medicines or would you take a second opinion? A second opinion, off course, isn’t it? You would not visit the doctor again, nor recommend him to your friends and family.

That is exactly what will happen to you, if you recommend a financial product to investors without understanding needs and concerns. He maylisten to you patiently, but ignore the advice and move on.

You’ll be portrayed more as a salesman than a trusted advisor–Because you have pushed a financial product without understanding the client’s financial health, number of dependant family member, his financial goals, insurance needs, risk profile, among a host of facets.

Remember, when an investor walks in, he expect you to handle his money with enough care and prudence as you would while managing your own money.

Pushing investment products is not the long-term interest of investors, or financial advisor. It could splinter relations. No one likes to be sold a product or a service; but appreciates a genuine, advice which is what investors look for in a financial guardian.

Risk tolerance will notmatch with that of the investor–As you may know, there is no universal level risk tolerance. It varies from individualsto individuals based on factors such as financial conditions, financial responsibilities, investment horizon to achieve financial goals,insurance coverage (both life and health) and liquidity.

A prudent assessment of the risk tolerance along with his/her age, past experience, knowledge and the comfort factor; laying an investment strategy is a prudent approach. It is best not to take investors for granted. After all, it’s question of their hard earned money and their long-term financial wellbeing.

For example, aninvestor who has burnt his fingers in the stock market may be apprehensive about investing in the stock market. Respect that! But rightly educate him/her if investing in equities is warrantedaidedfavourable factors viz. age, income, investment horizon, financial goals, etc. on his side. Every drop can make an ocean; so encourage to take up a Systematic Investment Plan (SIP) in mutual funds by advising consistent performing schemes from fundhouses that follow strong investment processes and systems. To achieve long-term financial goals, SIPs are a preferred route. A favourable performance can help investors’ gains confidence to invest even more.

The investment portfolio may go askew:Besides, wealth creation the investment portfolio should be able to address financial goals – children’s future needs (education and marriage), retirement, amongst a host of others, even the materialistic ones. If that not the case, portfolio construction would be ineffective or futile.

Recognising financial goals and then astutely selecting investment avenues, will ultimately achieve investment objectives, and earn the respect from investors.

So, when you deal with investors, ask them to pen down financial goals and edify them if they are S.M.A.R.T (Specific, Measurable, Adjustable, Realistic and Time-based), and classify them into short term, medium term, and long-term for the portfolio construction exercise.

End note…

Reputation is the key in the financial advisory business. If you follow high fiduciary standards and apply professional wisdom with utmost care, the brownie points you earn add to respect and trust amongst investors.

Remember, the customer / client is always the KING. So, always put his interest at fore as financial guardian.

How CKYC Can Help You Serve Investors Better

In India the reach and popularity of financial products such as mutual funds and insurance is abysmal considering the large population base we have. Mutual fund schemes, though being present for decades now, have not won as many hearts as they could from the benefits of investing in them.

Apart from the obvious reasons for this such as lack of awareness, rampant mis-selling, investors feel burdened to comply with multiple KYC (Know Your Client) forms that have added to the rather complex and cumbersome paperwork required to invest in financial instruments.

Now, hopefully things will change…

The Central Know Your Customer (CKYC)form that was introducedsince February 1, 2017 will make investing easier and reduce roadblocks in the financial services space.

Investors/clientswill have to undergo the process of complying with CKYC just once – either with a bank, mutual fund or an insurance company. They won’t have to fill-up the KYC form all over again with other financial product manufacturers again. The hassle is reduced!

Secondly, this procedure is a mechanism to determoney laundering.

The job of the authorities will be reduced to retrieving the investment data against the single photo identity proof and anaddress proof. To know how many financial investments you hold in your name, authorities will have to take lesser efforts.

A brief on CKYC…

To store the KYC records of the customers,the Government has appointed Central Registry of Securitisation Asset Reconstruction and Security Interest of India (CERSAI) to establish a central KYC registry.

And how does it benefit a client?

  • CKYC will store all information about investors at one central server that is accessible to all the financial institutions.
  • After opening a KYC account, investorswill receive a 14-digit identification number. When an investor wishes to buy a financial instrument, all he/she has to do is furnish this number.
  • What the number will do is pointto the record file that will have all the investor’s details saved centrally.
  • Lastly, the FATCA declarationwill also available in the same KYC form.

How does it benefit you?

  • CKYC makes client on-boarding easy. This saves you, the financial advisor, and the financial product manufacturer from completing the tedious process of KYC many times over.
  • You won’t have to spend your time filling up multiple KYC forms and provide countless self-attested documents.
  • Convincing a client to invest in a mutual fund scheme or a fixed deposit becomes simpler because of the reduction of barrier. It will save time and help you focus on drawing financial plans, addressing their queries and educating them about various avenues of investing in financial services.

Timeline to comply with CKYC

As per the Prevention of Money-laundering (Maintenance of Records) Amendment Rules, 2015, you need to file the electronic copy of the client’s KYC records with the central KYC registry within 3 days of commencement of an account-based relationship.You can download a CKYC form here.

Are there any challenges?

  • The new requirement may hit SEBI’s e-KYC programme thatuses Aadhaar and One-Time Password (OTP) through mobile phones for authentication of individual investors. The regulator’s plans to start selling mutual funds through e-commerce portals may also get delayed. And if there are technical glitches, there may be a problem while serving clients.
  • Moreover, information such as mother’s name, proof of permanent address, maiden name, etc.are some of the fields that are now needed to be recorded. Investors need to go through the whole KYC process again if they haven’t provided it earlier.


The CKYC is a healthy step towards removing entry barriers. It will encourage investors to invest in capital market. It is a win-win for both – financial advisors and investors. Educate investors on the importance of investing in mutual funds as they endeavour to meet numerous financial goalsin life. Also highlight why having an optimum life insurance and health insurance cover is imperative. Conducting a Financial Health Check Up, reviewing investment portfolios would also ensure investors’ long-term financial wellbeing.

How Financial Guardians Can Help You Achieve Your Financial Goals

Most of us dream of what we’d like to become at a later stage in life or the things we’d like to do. When it comes to our money,these dreams must be translated into clear goals to employ the best way of achieving them.

Typical aspirations in the world of financial planning could range from funding your child’s education to saving enough for a comfortable retirement. The key is to be realistic about what you think you can achieve, you’re confident in your ability to win.

Whatever you plan to do with your money, a Certified Financial Guardian (CFG)could help you achieve your goals.

So what’s so unique of a CFG?

  1. No sales obligation: A CFG shares his compensation model upfront. This approach builds trust and assures you asclient that a CFG has puts forth your interest in mind at all times. CFGs go a step further.They cement the relationship with clients by understanding their current financial health as well as the investment objectives before recommending any financial products.
  2. Protects you and your family: A CFG will ask you tough questions you may not have thought of: For example, “Have you saved enough for rainy day?”, “Have you ensured the financial wellbeing of your family when you pass away”, “Have you written a Willto pass on assets to your loved ones?” amongst a host of others.The idea behind is to make you rightly introspect to recognise the nuances of financial planning.
  3. Avoid costly mistakes, administration costs, investment fees, and taxes: These are some of the costs novice investors miss while planning their financial future. A CFG is aware of these and the impact on your financial goals. Therefore, they can prudently suggest an alternative course of action.
  4. Setting a time frame for your financial goals:Good financial advice helps you set and planfinancial goals. A CFG will assess if your financial goals are S.M.A.R.T. (Specific, Measurable, Adjustable, Realistic and Time-bound) or are mere fantasies. Based on the time horizonto achieve it, he/she can classify the goals into short-term, medium-term, and long-term. This helps you maintain focusand channelize investments accordingly to achieve them.
  5. Prioritise financial goals: We all have multiple financial goals and all of them seem important to us. Planning for them can be a herculean task if you don’t prioritise them. So, based on the urgency and the time horizon, a CFG can help counsel you to distinguish between: responsibilities, needs, and dreams.

Children’s education is a ‘responsibility’ that needs to be shouldered.

Buying a house to live in and saving enough for a comfortable retirement are a ‘needs’.

On the other hand, wanting to ownhigh-end luxurycars,or going on a world tour, could be a ‘dream’, which may be within reach (can be planned for) or beyond (cannot be planned for) based on a financial assessment.

Your financial life will be stressful if you fail to slice and dice your financial goals well. A CFG looks at your plan objectively. They are rational, rather than emotional, which will help you immensely in the goal planning exercise.

  1. Reduce stress: Even with the best intentions, it’s often hard to find enough time to create and manage a comprehensive wealth plan that will really make the most of your money. With a CFG to handhold, you can confidently tread on the path to wealth creation and financial wellbeing.
  2. Draw a prudent financial plan:A CFG possesses skills to draw a prudent financial plan to takebetter control of your personal finances and meet your aspirations vide a variety of investment avenues. This is intended to achieve the investment objectives and buildthe required goal corpus taking cognisance of your risk profile.Besides, he/she will periodically review the plan to ensure you’re on course, make necessary corrections if need be, and even account for changing dynamics (a new member into the family, a medical emergency, an unexpected layoff, etc.). So through this agile approach there’s enough goal mapping and goal tracking.
  3. Leave a legacy: A CFG will help you assist in prudent estate planning to make sure your family is financially secure when you pass away. Note that, if you die intestate (i.e. without a Will) the law of the land will distribute your assets in a manner which you may not have intended.
  4. Be empowered: A CFG with handholding at every point in time and by imparting financial knowledge empowers you as an investor, whereby you start taking conscious financial decisions in the interest of your long-term financial wellbeing.

Remember, sound financial advice, guidance and support can help make your dreams come true. To find a financial advisor whom you can trust visit

7 Questions You Need To Ask Your Financial Guardian

7 Questions You Need To Ask Your Financial Guardian

There is no dearth of financial advisors in the country. Every one represents him/her as a sensible, well-intentioned financial advisor. Relationship managers at banks are no different. They portray to have the clients best interest in mind all the time. But that’s seldom the case!

Take for instance the case of Mr Shivraj Puri…

Not too long ago (in 2010) Mr ShivrajPuri, a relationship manager with Citibank’s Gurgaon branch (now calledGurugram) duped his clients for Rs 350 crore. This was the least expected of a seven-year veteran from the wealth management team of an esteemed international bank. Mr Puri channelled hard earned savings of 30 investors into the stock markets without their consent. He was suspended after the bank lodged a police complaint. He was booked for suspicious transactions, forgery, and criminal activities. The Courts pronounced Mr Puri guilty under various sections of the Indian Penal Code (IPC) and was sentenced to 2 years &six months imprisonment, plus a fine of Rs10,000.

There are countless cases across the world where investors/clients (including celebrities) have been duped falling prey to sweet-talk of financial advisors. Relationship managers / agents / so-called financial advisors, have put their vested interest at fore; hauled out the most from the clients vide incentives / commissions. They tiptoe around realfinancial planning, and as a result you, the investor suffers; as they don’t stand as ‘Financial Guardians’who handhold in the journeyof wealth creation and achieving financial goals.Many financial advisors have just resorted to unethical practices and made hay when the sun shines. This is disrespect to a profession where a financial advice should be given with utmost careand prudence.

Besides, as an investor it is your responsibility to protect your hard earned money. So, before you sign on the dotted line, ask these 7 questions to your Financial Advisor/Financial Guardian:

  1. The professional fees charged – In the financial advisory business, there are mainly 3 business models in India: fee-based, fee+commission, and purely commission driven. Assess which category the financial advisory you’re dealing with fits into. It is ideal to take services of a financial advisor/guardian who charge professional fees for the services rendered (just like architects, doctors, lawyers, chartered accountantsdo). Keep away from advisors who follow a purely commission driven approach and even be careful while dealing with relationship managers who’re driven by incentives.
  2. The credentials –Be sure to check the professional qualifications of the financial advisor/ financial guardian. Few professional institutions have a rigorous curriculum for aspirants. These institutions ensure their members follow a code of conduct and abide by the principles of ethics and integrity of the profession. Also, recognise how they manage to keep themselves abreast with the developments in the profession and even regulations related to it. Make sure that the credentials of the financial advisor/guardian are in force,i.e. whethercertifications/professional membershipsare renewed. This would assure a prudent approach, better advice, better service and the commitment ofthe financial advisor/guardian towards his craft.
  3. Transparency / disclosure norms – Financial guardians/advisors who have undergone professional certifications and who strictly comply with the regulations usually vow by transparency. They abide by the principles of ethics and follow full disclosures as needed. This also helps to earn respect, trust, and loyalty of investors.
  4. How will financial goals be addressed – M.A.R.T goals are the bedrock when building a solid financial plan. Your financial advisor/guardian should be able to slice and dice your financial goals into should short-term, medium-term, long-term, and thereafter in consultation with you, draw a financial plan. This approach ensures a synchronised effort and perhaps even handholding in the goal planning exercise with correct documentation.
  5. How will my risk appetite be gauged– Goal planning exercise without assessingthe risk profile is pointless and risky. If a financial advisor/guardian does not ask you pertinent question to gauge the quantum of risk you are willing to take and can afford,recommendations could look cockeyed. A risk profile helps a financial guardian to understand your outlook towards money and thereby determine the financial risk you can take. A holistic approach can even help in gauging your insurance needs (be it life insurance, health insurance, personal accident insurance etc.), even if it is beyond the scope of his/her work.
  6. How investment avenues would be selected – Different investment avenues pose different risk-return trade-off. They cannot be generalised by any means. So, the investment strategy you need to follow will changedepending on your risk profile, the time horizon to achieve your financial goals, income, assets, contingency reserve, amongst a host of other aspects.
  7. How often will the portfolio/financial plan be reviewed –A regular portfolio review can help you ascertain if you’re on the right track to achieve your financial goals. The review can be quarterly, semi-annually or yearly depending upon the complexity of the case and the dynamics involved. A corrective course, if required, should be proactively suggested by the financial advisor/guardian. Besides, there’s operational support which ought to be well co-ordinated. A proactive approach on the part of the financial advisor/guardian augurs well for your portfolio/financial plan.

A Certified Financial Guardians (CFG) abides by all these vital aspects. They stand for high fiduciary standards. Irrespective of where you stand in your finances, be wise and seek a second opinion from a CFG. It is time to search for one nearest to you and take an appointment.

How CFGs Strike A Correct Chord With Clients

According to Karvy Private Wealth’s India Wealth Report 2016, the total wealth held by individuals in India grew by 8.5% to Rs 304.2 lakh crore in the year 2016 (as highlighted in Table below). Investments in financial assets also grew, but at a slower pace:7.14%; mainly due to subdued performance of equity. Among financial assets, there was reasonable growth in fixed deposits, bonds, provident funds and Small Savings Schemes (SSS); the last mainly due to the success of the Jan Dhan Yojana (under which 25 crore accounts have been opened). Individual wealth in physical assets (such as gold and real estate) too grew sharply at 10.32% vis-à-vis a 2% fall in FY15.

Proclivity:  Financial Assets vs. Physical Assets


(Source: Karvy Private Wealth’s India Wealth Report 2016)

However, the economy is in for a rocky roadafter demonetisation, which potentially is a risk to the economic growth clocked. After the World Bank’s downward revision of growth estimates for India, the IMF too has reduced growth estimates for India to 6.6% (from 7.6% projected in October 2016) for the current fiscal year 2016-17 citing the impact of demonetisation. “Temporary negative consumption shock induced by cash shortages and payment disruptions associated with the recent currency note withdrawal and exchange initiative,” were the primary reasons said the report released recently. 

Besides, there are global factors in play such as: ‘Trumponomics’ is coming into effect from January 20, 2017; the Federal Reserve’s endeavour to normalise interest (as market expectations for inflation have advanced); the process for ‘Brexit’ taking pace from end-March 2017; Italy calling a referendum to exit Eurozone in the middle of a struggling banking sector; even in France, the Front National Party President, Ms Marine Le Pen is calling for a ‘Frexit’ (France’s exit from the European Union); there are economic slowdown concerns for China; and economic conditions in Japan are morose (although there’s some optimism reported of late).

In such uncertaintimes, where the path to wealth creation is full of challenges, it is important to seek the help of a Certified Financial Guardian (CFG)who will advise you with enough care and prudence, much as he would adopt while managing his own money.

There is no dearth of financial advisors in the country. Every one flaunts a certification or two and suffixes his/her name with an acronym. But your financial advisor should be a ‘Financial Guardian’who is able to recognise the financial and emotional side of the client /prospect using these simple (yet important) principles:

  1. Transparent and Ethical advice: The advisors who have undergone the CFG certification vouch to strongly abide by the principles of ethics. The major bane among clients/prospects is the lack of transparency – disclosureson the part of financial advisors; for instance their compensation structure. CFGs disclose it upfront thus building trust and putting the clients’ interest first. CFGs go a step further. They cement the relationship with their clients by understanding their financial health as well as their investment objectives before recommending any financial products.
  2. Thorough research before recommendation: CFGs conduct thorough research and in-depth analysis of the financial products before recommending it to their clients. Clients can rest assure that the recommendation would help them achieve their financial goals.
  3. Service oriented approach: CFGs build a team of professionals and experts who address the queries of the clients prudently and effectively in a time-bound approach. CFGs explain the rationale of their recommendation to their clients. The idea is to be in sync with the clients’ money outlook and avoid confusion. They are open to queries and patiently invest time to resolve them.
  4. Do not believe in one size fits all approach: CFGs are known to offer personalised and customised solutions. They offer financial recommendations after analysing the risk profile of clients. They take into consideration age, financial goals, income, expenses, etc. before suggesting a solution.
  5. Adopt agile investment strategies: At times, there could be stressful situations such as stock market crashes, economic or political uncertainties, and personal emergencies etc. that could create a lot of anxiety and stress in the mind of the client. A CFG provides a sound coping strategy and mental comfort during such times.
  6. Regular review and support: A CFG regularly reviews the client’s portfolio to see if it is in sync with the investment objective. A course correction, if required, is proactively done in consultation with the client. Besides, there’s operational support. This hands-on approach helps them earn loyalty and trust of clients.
  7. Ask for an honest feedback: A CFG won’t hesitate to ask for honest feedback. He/She would proactively seek it and make necessary changes in his/her approach. The idea is to make the client feel appreciated, respected, and at home.

So hope you recognise the need for a financial guardian, who can hand hold you professionally and prudently in the journey of wealth creation. Irrespective of where you stand in your finances, it would be wise toseek a second opinion of CFG.

A CFG commits to adhering to these steps and places the client’s best interest ahead of his/her, at all times. It is time to search for one nearest to you and take an appointment.




7-Step Approach Followed By Financial Guardians To Build Wealth

In the last article dated Jan 7, 2017 we talked about the need to appoint an accredited financial guardian to manage your finances.

In today’s article, we take a step forward and evaluate 7 steps followed by practicing financial guardians to build their clients wealth.

Yes, that’s right! Your wealth…

But before we share the 7 steps, here is what you should know—the government does not regulate financial planners as financial planners. Instead they regulate planners by the services they provide.

As a result, the term ‘Financial Planner’ may be used inaccurately by some financial advisors. To add to the confusion, many financial advisors like accountants, insurance agents, and other investment advisors (such as post office agents) offer financial planning services too. To be sure that you are getting the right financial planning advice, ensure your financial guardian/advisor/planner follows the 7 step approach.

7 step approach to build clients wealth.


(Source: PersonalFN Research)

  1. Ethical Standards: Whether you choose a doctor or a financial guardian, the one parameter that ranks at the top is his/her fiduciary standards. There are countless stories of financial advisors taking advantage of a client’s ignorance and siphoning off their hard earned money. Advisors with loose ethical standards recommend financial products that pay them more (i.e. they recommend financial products that earn high commission) often at a client’s expense.  

    Although it is very difficult to judge the ethical standards of an advisor in the first meeting, his remuneration model can tell you a lot about him/her. 

    Primarily, there are 3 ways in which a financial advisor/guardian is being compensated today in India:

    • Purely fee based model: These advisors, though scarce, offer advice based on a fee (just like doctors, chartered accountants, lawyers, architects etc.). They don’t sell any financial product and may direct you to a product distributor, if you wish to implement their suggestions. Although, there is high probability of securing honest advice, the fees are steep and middle class families find it difficult to afford their service. These advisors/guardians/planners principally cater to the elite segment of HNIs and Ultra HNIs.
    • Fee + commission model: Most financial planners/advisors/guardians in India follow this model. Because the advisor is getting compensated through commissions, he lowers his fees vis-à-vis a fee-based advisor. The fees range between Rs 5,000 to Rs 20,000 depending upon the complexity of the case. Although the chances of advisors ‘beneficial interest’ creeping up in the advice cannot be ruled out, the advice will be beneficial to middle class families who cannot afford the advice of a fee-based advisor/planner/guardian.
    • Purely commission model: These financial advisors/planners/guardians should be avoided at all costs. Don’t fall for their smooth talk and RUN when you hear they have your best interest in mind. They are agents of product manufacturers in the guise of planners. They often recommend financial products that cater to their best interest (read: high commissions). Most insurance agents, bank relationship managers, post office agents, etc. fall into this category.
  2. Need based analysis: Need Analysis is the process of identifying and evaluating needs. The identification of needs is a process of describing “problems” and possible solutions to these problems. A certified financial guardian (CFG) recommends a solution to you only after understanding your concerns. He is like a doctor who recommends a cure after diagnosing your problem.
  3. Goal Planning: Many people feel as if they’re adrift in the world. They work hard, but they don’t seem to get anywhere worthwhile. A key reason that they feel this way is not having spent enough time thinking about what they want from life, and haven’t set themselves formal goals. After all, would you set out on a major journey with no real idea of your destination? Probably not! CFGs work along with their clients to build M.A.R.T financial goals. These goals have milestones which not only keep the clients on track but also keep them motivated.
  4. Risk Profiling: A wise old saying reads–“All five fingers are not identical”. A strategy that worked for your neighbour may not work for you. What is required is to assess your risk profile before choosing the financial product. A risk profiler are a list of questions that will help you know exactly how you feel if an unforeseen event had to happen (say a sudden stock market crash) or what matters to you most—capital protection or capital appreciation with high returns, etc. These questions will make you look deeper within yourself and touch upon the qualitative factors of decision making. A CFG would, at all times, connect the quantitative factors with the qualitative before proceeding to recommend the financial products.
  5. Asset Allocation: The earliest note of the famous saying “Don’t put all your eggs in one basket” is in 1710, in the Oxford dictionary of English proverbs. And that is exactly what asset allocation is all about! Asset allocation talks about wisely distributing your income across equity, debt, and gold based on your financial goals, risk profile, and the time horizon to meet these goals.
  6. Selecting the right investment avenues: Contrary to popular belief, selecting an investment avenue falls almost at the last stage of decision making. At the same time, there are complex and confusing financial products that can intimidate most individuals. An expert CFG will recommend a product to his clients after taking all of the steps above into consideration.
  7. Portfolio tracking, review and revision: No one knows what the future holds. The financial instruments that may be performing well today may not do so tomorrow. Similarly, the financial goals may change with time. The portfolio that you have developed today not only needs monitoring but also revision. This is what a CFG would do. He/she will monitor the progress of your portfolio to see if it is in-sync with your goals and suggest revisions wherever necessary.

These 7 step approach helps a client build his wealth. A Certified Financial Guardian (CFG) commits to adhering these steps and place the client’s best interest ahead of his/her, at all times. It is time to search for one nearest to you and seek an appointment.


Why You Need A Financial Guardian For Your Finances

Before we delve deeper into the topic, let us define a financial guardian…

An accredited Financial Guardian is someone who uses the financial planning process and instruments to help you figure out how to accomplish your life goals. S/he not only takes into consideration your financial goals, needs, risk appetite, and exercises such as budgeting, investments, tax planning, but also recommends  financial solutions with your best interest in mind every time. This approach sets a Guardian apart from other financial advisors, who may be trained to focus on a particular area of your finances. 

A Guardian who stands for ethics, integrity and putting your interest first, at all times.

An individual who does not follow this approach is not a Financial Guardian, merely a product distributor.

One may say, “But why can’t I do my own Financial Planning instead of approaching a Guardian?

Of course, you can! Actually, there are quite a few personal finance websites, magazines, and self-help books educating countless investors in the art of money management. However, here are some questions you need to answer before deciding whether you need a Financial Guardian or not:

  1. Do you follow a strict budget? — Most individuals tend to spend before they save. Are you one of them? The mantra to follow is: Income – Savings = Expenses. But if you are honest with yourself, you’ll agree that there is hardly any money left to save at the end of the month. In fact the money seems insufficient to even meet your monthly expenses.
  2. Are you saving for your future? — Probably the answer is a quick “yes”. In fact statistics show that Indians are far better at saving their money vis-à-vis other developed countries. If you are like most individuals, savings is what is left after meeting your expenses, put aside either in a fixed deposit scheme or gold or an insurance policy which were suggested by your friendly neighbour (who happens to be an insurance agent). Capital protection and guaranteed returns rank higher as parameters that you should astutely consider before you invest your hard earned money; don’t you think? But take a moment here and seriously consider if the amount that you are saving would help you achieve your financial goals—educational expenses of your children, marriage expense when they grow up, building a retirement corpus that lasts your lifetime, etc. If you don’t know the answer, dial HELP immediately.
  3. Do you believe that Insurance is an investment product?—If the answer is “yes”, then you need to seriously consider approaching a financial guardian. Insurance is a financial instrument meant to protect against risks. It is not an investment product as some may have you believe.
  4. Do you know how to choose a financial instrument?—There are a number of financial instruments available today in India. And they can be complex, confusing, and intimidating. What is your approach for choosing a particular financial instrument? Do you rely on magazines, periodicals, television shows, and well-meaning friends and neighbours to make a decision? If “yes”, then think again! It is high time to get your portfolio reviewed.
  5. Do you have a plan for the falling markets?—Planning during the bull phase is easy and an ideal situation that we all like to be in. But, life isn’t all sunshine. There will be days when the stock market will crash (remember the 2008 crash?) and erode a huge chunk of your hard earned money. Are you prepared for it? What’s your PLAN?
  6. Do you look beyond real estate, gold and fixed deposits?—Do you still consider that the only way to build wealth is through real estate, gold savings, and fixed deposits? Have you invested a major chunk of your finances in these three instruments? If “yes” then you need to consult a Financial Guardian, NOW!
  7. Do you have a succession plan in place?Do you have a Will? Or do you think this job is best left till your hair turns grey? Or are you the parents of special needs child? Have you written down a Trust Deed? If “no” then consult a Financial Guardian at the earliest. Note, if you die “intestate” (i.e. without a Will) the prevailing “law of the land” will apply and your money will get distributed in the manner that you may not have wished for.

The list can go on.

So hope you recognise the need for a Financial Guardian who can hand hold you professionally and prudently in the journey of wealth creation. Irrespective of where you stand in your finances, it is a wise decision to seek a second opinion.

You will be able to evaluate and choose a Financial Guardian here

All the Guardians listed on the have gone through a program emphasising not only on the different areas of personal finance but also on the importance and essence of developing a financial planning advisory based on the principles of ethics and integrity.

Meet India’s 1st CFG – Mr Viran Patel from Vadodara

During his 15-year long experience in the financial services / advisory industry, Mr Patel has noticed that agents lack professionalism. Financial products are sold rather than advised. This impelled him to make a change and save investors from the clutches of such agents (who often mis-sell).

He took up the challenge and successfully pursued the Certified Financial Guardian (CFG) Certification in the endeavour to make investors moneywise – and is India’s first CFG.

An ardent worshipper of Goddess Saraswati, Mr Patel believes, knowledge should be shared and therefore, he conducts investor education programmes and regularly updates his clients on economic and market related matters. To keep himself abreast, he reads business dailies and various finance posts on the internet.
Some of his favourite books are The 7 Habits of Highly Effective People by Stephen Covey, and Change Your Thinking, Change Your Life by Brian Tracy.

Mr Patel claims to follow a serious, sincere, and an ethical approach in his practice as financial advisor. He does not endeavour to sell financial products, but to provide the best financial solutions to investors based on a thorough need-based analysis, risk profiling and investment horizon, with minimum churning in the portfolio. His integrity ensures he manages his client’s wealth with as much care as he would manage his own. It is this approach that has earned him happy, loyal clients.

Mr Patel’s motto and vision is providing ethical and apt financial solutions to investors considering all parameters and wishes them a life with health and wealth.

His idols in the mutual fund industry are Mr Sankaran Naren, CIO of ICICI Prudential AMC Ltd, Mr Mrinal Singh, Senior Fund Manager at ICICI Prudential AMC Ltd, and Mr Prashant Jain, ED & CIO of HDFC Mutual Fund.

Mr Patel aspires to be termed a ‘financial doctor’ in his profession.
His advice to investors is: ‘Don’t run for short-term gain; instead invest for the long-run…and start saving early with perseverance for your long-term financial wellbeing’.

Mr Viran Patel can be reached Here

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7 step approach to build clients wealth