Jai Adiani, Certified Financial Planner, SRE Financial Planners in an exclusive interview with Yogita Khatri of Myiris.com explores the business of financial planning and how investors can use it to their advantage.
Jai Adiani a Certified Financial Planner has several years of experience in the financial services industry. His previous experience has been mainly in broking where he has lead a team of RM`s in Equity sales & Relationship Management. His expertise is in Technical Analysis, Portfolio Management, Investment Advisory, Wealth Management & Business Development. He is also visiting faculty at Financial Planning Academy. He has authored several articles in various magazines. He is presently working with SRE Financial Planner.
Here are some excerpts from the interview:
What led you to choose Financial Planning as a career?
I was always interested in finance, investments & capital markets since my college days & I joined a leading broking firm as soon as I graduated. After working several years in the broking industry, I felt that whatever advice I was giving clients, it was more inclined to generate business for me & had not much of a positive effect on a client`s financial health. The advice was more on trading & not on their financial needs. At the same time I started pursuing my CFP Certification & during that I realized the value of need-based Financial Planning. Today financial services industry has become like a jungle where a customer never knows what lies in the next turn or is an advisor advising him with client interest in mind, a Financial Planner stands out like a true guide who keeps clients interest foremost. He is like a financial doctor who diagnoses client`s financial health & then prescribes financial instruments to improve it. Thus I wanted to be part of a profession which is not only about selling but about understanding client`s need, advising him on it & `Right-selling` various financial instruments available.
What is your take on current market situation? How do you see the market going forward?
Fundamentally speaking, capital markets are at a junction where everyone is waiting for the next major economic indicator. With Elections & budget done with, market players will wait to see the next 1-2 quarterly results from companies to see how the corporate sector has reacted to all the latest updates. With worldwide economy recovering from recession, India will definitely benefit as India was never in recession but just had a slowdown. The present fall has been due to the increasing fiscal deficit but in the long run India looks like an outperformer. Technically speaking Sensex needs to cross & sustain the 15000 mark for further gains. As of now it is stuck in a trading range of 15000-11500.
What services do you offer? How long have you been advising clients?
Since the last one year I have been offering Financial Planning services to my clients. These services include Comprehensive Financial Planning, investment planning, insurance planning, investment planning & tax planning. The main point here that clients need to understand is the difference between an investment plan vs investment advisory, insurance plan vs insurance selling etc. All plans are made on the basis of a client`s needs, and are unbiased & customized. An investment plan may not consist of only equity but some plans may consist of only debt or gold depending on client`s profile.
Briefly explain the investment/selling scenario of the financial products you offer in current market?
The products I basically offer to clients are various types of financial plans such as comprehensive. Investment, retirement etc. All plans I make are fee-based which shows my clients that my advice is given with no commission motive in mind. If the client is interested in implementing mutual fund, equities or insurance through me then SRE Financial planners provides all these products.
How important is an independent financial advisor (IFA) in the total sales process?
An IFA is extremely important in today`s financial market. He is a person who is the face of the financial product/ company for the customer. In insurance & mutual funds, agent/distributor is the main force behind the AMC`s increasing sales & AUM. The main reason for this is the `Personal Touch` effect. Customers can contact a Mr. Adiani more easily for their doubts, worries, expectations & clarifications than directly a fund house or an insurance company.
In today`s fluctuating market conditions, what`s been the most common reaction from your clients?
As a Financial Planner I advise clients on investments with their financial goals & long term views in mind. Thus if a client has a goal with 1-2 years, I do not advise them to put funds in equity but more in debt. Financial Planning is done with the objective of negating the effects of inflation & market vagaries. There is no use of capital appreciation in your funds if the same is not available when you need it the most. Thus my clients usually are not affected by market fluctuations as they know the advice is with a long term horizon & achievement of their goals in mind.
What do you think influences investor confidence most? Do you think investor confidence is improving?
Investor confidence can be seen on two levels; at the industry level & then at the IFA/individual level. At the industry level we need more investor awareness campaigns & more transparency in transactions. Mis-selling of financial products needs to stop for increased confidence at both the levels. At an individual level, IFA`s need to first `listen` & understand what their clients need & then advice products. As a Professional Financial Planner, I believe in the philosophy of `reacting not acting` which means do not start with selling a specific product but advice a product after understanding his needs. The mode of revenue may be commission or fees but the aim should be `Right-selling`. This will definitely improve investor`s confidence.