Problem of plenty: How to find the right financial planner
India has about 70,000 mutual fund distributors, of which about 10,000 are active. About 500 investment advisers are registered with the Securities and Exchange Board of India (Sebi). India also has 6,000 certified financial planners, certified by the Financial Planning Standards Board (FPSB) India. How do you find the right person to look after your money box? Your relationship with your financial adviser is somewhat like a marriage. If it’s a good match, your money box is taken care of. But if it’s a bad match, then your financial goals are never met. Here are a few ways to search for the right financial adviser.
REFERRALS
Ask your family, friends and colleagues if they know of or consult any financial adviser. This is the best way to search for someone suitable. Although a financial adviser’s qualification is important, how she actually handles the money is more important. “Referrals are very important because it is a shortcut to understanding whether a person (the adviser) is good or not,” said Suresh Sadagopan, founder, Ladder7 Financial Advisories.
Preferably, ask for 3-5 names. Then go and meet these advisers with your partner or spouse and have a detailed chat. Typically, mutual fund distributors or insurance distributors don’t necessarily advise you holistically on your money box. But financial advisers will have suggestions on your entire money box. Some of them, especially registered investment advisers charge fees, but they don’t charge the first time you go to meet them. See if you are comfortable with the adviser and have confidence in her abilities.
WEBSITES
There are popular websites as well that provide a list of planners.
One such website is www.financial-wellbeing.com. This was launched by Network FP, a firm that trains aspiring financial planners. Go to the ‘Experts’ section. Here, you can search for names based on the city you live in and the expertise you are looking for. Advisers must meet multiple criteria to get listed here, said Sadique Neelgund, founder of Network FP. To start with, advisers should be suitably qualified and have work experience of at least 3 years as a personal finance professional. You will find about 150 advisers listed here.
Two other websites can be of help. The FPSB India website is one. Here, you can search for an adviser by name, city, state or nature of the adviser’s employment (corporate or self-employed). Since FPSB India is a body of certified financial planners, anybody who passes its certification examination gets listed here, even though she may not practice commercially.
Another website where you can find advisers is www.advisorkhoj.com. Enter your pincode and the type of adviser (either product-wise or qualificationwise) and you will get an adviser who is closest to you. However, ignore the star ratings here. “Just because an adviser doesn’t come with a star rating, doesn’t mean she is bad,” said Pradip Chakrabarty, founder and chief executive officer, Advisorkhoj.com.