What is true financial planning?

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Financial Planning has become a buzzword in the financial services industry nowadays. Banks, insurance companies, mutual fund companies, etc use this term a lot these days. An insurance agent will call himself a financial planner & a big bank may offer financial planning services. But what are they providing under the term financial planning. Most of them just use the term ‘financial planning’ very superficially & are actually just selling financial products. So an insurance agent will just sell you another Unit linked insurance plan saying that this is offering best returns, giving tax benefits & it is the best financial planning you can get. The question of insurance is usually omitted, ironically.

Banks which offer financial planning are actually just selling mutual fund schemes, portfolio management schemes or any new scheme which they can get their hands on. There are some who do give you a written document known as a ‘financial plan’ but this usually does not give you any insight on your finances but is usually a more polished way of telling you what to buy. The reason for this is that most of them earn good commissions on sales made. The question of good, practical & unbiased advice for consumers is very much absent.

So what is ‘true’ financial planning?


Let me explain with a story I heard during my childhood. The story is about an elephant & four blind men. Different variations of this story have varying number of blind men. I will assume the number of four blind men. The first blind man comes towards the elephant’s trunk, touches it & thinks it’s a water pipe. The second touches the body of the elephant & thinks it’s a wall. The third touches the leg & thinks it’s a tree trunk. Lastly the fourth holds the tail & thinks it’s a rope. All touch different parts of the elephant & have different things to say. However when a person with clear vision sees the elephant, he knows it is an elephant.

Blindness & clear vision here should be taken in context with financial literacy. A mutual fund advisor, stock broker or portfolio advisor will usually advice you only on your investments, ignoring insurance needs, tax angle & goal-planning. A tax advisor will just show you how to save tax, not realising that just blind tax-saving is not right. An insurance agent goes a step ahead. He will most probably advice you on your retirement needs, investments & tax-planning but he somehow fails to advise you properly on the main reason you came to him, insurance! A financial planner keeping in mind all the above factors i.e. your financial goals, insurance needs, investments, cash flow, etc shows you the full picture of your finances or in other words the elephant!

Financial planning is thus, a systematic approach to your personal finances. When you have a target, you tend to work towards it. Thus when you write down your financial goals such as comfortable retirement, child’s education or even a dream vacation, you have visualised a target. Then you need to see where you stand. This means seeing your current  financial status i.e. income, expenses, assets & liabilities. These are just like the four legs of a table. The table being in this case, your financial plan. The next step is to bridge these two i.e. where you are & where you want to be. An unbiased approach is of importance here. You may or may not need a product. If you need a product, the best should be advised.

This brings up the question- why sign up for 'Personalised Financial Planning' services with Fpguru.com?

1. We offer unbiased financial advice & product recommendations in your financial plan.

2. Our plans are made with full integrity & honesty.

3. The financial plan made for you is fully customised. This is not a stock plan or basic plan. We will deliver the plan in 21 working days. If it was just a stock plan, we could give it in 1 day.

4. Data provided by you is private & confidential. We do not display your data on our site nor do we pass it on to anyone. Even your plan is not uploaded on the site.

5. Our Services are fee-based. Financial plans are usually made for a fee, which is right as it shows that the advice given is unbiased. In this fee-based service we personally meet clients & advise them on their personal finance. It's a more of a hands-on approach. As the name suggests we are coaching & educating the client in all aspects of financial planning. This in turn builds a life-long relationship based on mutual trust & respect.


6. This will be a yearly service & includes the financial plan, investment advice, product advice, semi-annual review meeting & telephonic support. Most importantly the advice will be un-biased & made with only your financial goals in mind.

 

If you are looking for a financial planner who is really keen on educating you & backing their advice with strong reasoning, look no further! We believe in ‘not giving you a fish, but teaching you how to fish’!

 

These are some of the reasons for making a financial plan through us. Ultimately our goal is to show you the right path towards your financial goals as well as educate you on personal finance. We feel an educated customer is a long-term customer. Only with a proper financial plan will you be able to understand what needs to be done to achieve financial nirvana. This is ‘true’ financial planning!

 

If you would like to sign up for our ‘Personalised Financial Planning’ service you may write in to us at This e-mail address is being protected from spambots. You need JavaScript enabled to view it or call us on 091-9821336126.

 

If you would like us to call you, please share your contact details with us here-  Click here

Let the wheels of financial nirvana roll!

 

Jai Adiani

Founder, Fpguru.com

 

Comments  

 
0 #4 Jonathan 2013-10-17 17:02
Jai,

I enjoyed the post, thanks for your perspective.

Your following quote couldn't have been more true:

"There are some who do give you a written document known as a ‘financial plan’ but this usually does not give you any insight on your finances but is usually a more polished way of telling you what to buy."
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+1 #3 Roshni Bhatia 2012-02-20 13:14
In the absence of proper financial planning, no individuals would save money to invest. If there is no investments, then we would face a liquidity problem.As compared to past few years, as the trend is observed, savings have already reduced which is a serious concern for the economy. Hence, Financial planning is a Must!
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+1 #2 Fpguru.com 2011-07-11 06:34
@ Rajesh R Mishra,

Thanks for the feedback & support!! We are there to provide you advise on personal finance. If you have a specific question, please visit our askfpguru page & for making a free plan visit our data collection form page. Just fill in the data, reply to the confirmation mail & in 21 working days you will get your financial plan!! Hope this answers your query!!

Thanks & regards,
Fpguru.com
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0 #1 RAJESH R MISHRA 2011-07-08 16:24
hii
Dear FP Guru,
I Like the message very much and i was also lead by parts , but wish to see the whole elephant , which i have got an insight by reading thro the article, i will surely recommend this site to many such people in a financial dilemma
ALSO I WISH TO MAKE AN FINANCIAL PLAN from your site ,PL ADVISE
thanks
RAJESH MISHRA
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