Do you really know your wealth adviser?

Debojyoti Ghosh | TNN



    In today’s hectic professional life, we might not always have the time to take care of our savings and plan our investments. While the internet has made it easy to access information to independently manage our finances, making the best use of the information can be overwhelming. Most of us then tend to fall back on an advisor to develop a portfolio, plan for retirement or other financial goals.

    But is it always the best advice you get? The financial advisory industry is booming with the entry barrier being very low. “Quality advice is hard to come by and most advisors including big players wanting to make quick money opt for a revenue-based sales model as opposed to a needbased advisory model,” says Daya Paul, an independent wealth manager. Most large organizations and bank wealth managers tend to promote their own products under the garb of ‘advisory services’. “The concept of private banking is not just product selling. A portfolio should be research oriented with products based on credibility and returns instead of commissions and pressing targets as is usually the case,” says T Srikanth Bhagavat, MD of Hexagon Capital Advisors.

    Professional financial help goes beyond picking stocks and mutual funds. A wealth manager should be able to impartially say which product is best suited for you among a range of them and why. “ It’s important to train financial advisors to focus on each client’s unique needs. There has to be some empathy towards clients to create a heterogeneous atmosphere,” says Narayan Ramachandran, MD of Morgan Stanley. Samir Bimal, country head (private banking) of ING Vysya Bank, feels that within private banking, one should offer an investment view from across a range of financial instruments. “We follow an openarchitecture based, advisoryled investment approach,” he says. One comes across insurance agents, chartered accountants, mutual fund distributors and other organizations claiming to be ‘wealth advisors’ “Age, experience and understanding of an asset book play a vital role in case of wealth advisors. There’s no finishing school for wealth mangers,” says Mrunmay Das of Das Capital Management and Advisors. “A 25-year-old doesn’t have the wavelength to match that of a 50-year-old person. Half of the investment bankers are clueless on areas like tax planning and regulation since they’re fresh from Bschools. You should be exposed to various situations to gain experience.” Banks agree that while hiring from B-schools has seen a rise in the investment banking sector, this does not always translate to inexperienced people handling portfolios.

A good financial adviser should be able to

Answer specific questions, organize and orient your overall financial picture Assess your needs and make sure you have all of the basic insurance you need to protect yourself, your family, and your assets Avoid costly mistakes, manage risk, save time and improve your overall investment results Guide you through the maze of legal and tax implications and can put you on course to have a flexible financial plan Decrease your tax liability Provide the emotional discipline required to make sure plans are acted upon Provide guidance, reassurance, support and stability to reach your goals

Choose an adviser who

Comes across as a pleasant personality who can listen Has at least 8-10 years experience in advisory domain Can be with you for a long time Not just tells you when to buy, but also tells you when to sell and protects you from the downside of the market