Designation: Principal Financial Planner
Name of practice: Ark Financial Planners
USP of the Practice: Understanding people, before numbers. We are a boutique financial planning firm and believe that financial planning is not only about number crunching. At Ark, we ensure that whole process is very interactive and the client is fully involved.
Number of Employees: Total of 5 employees including 3 planners
Can you tell us about `Ark Financial Planners` and its mission & services? What services do you offer?
Ark Financial Planners is a fee based financial planning firm which is serving Indian clients across the globe. Our priority is to help clients achieve their goals. Not only fulfillment of their goals is our responsibility, but we also make sure that this entire process is independent, comprehensive and competent.
We ensure that our clients get an understanding of the investments and use resources in such a way that they get the most from their life stressing over financial matters. We focus upon comprehensive financial planning only as we believes that financial planning is the only way through which people can achieve their financial goals.
How long have you been in the financial advisory business?
I am in financial advisory services since the last ten years. I started in the sales function for a leading financial distribution house. Here I got exposure to all third party products. From there, I moved to asset management companies, where I remained for six years and after attaining the position of a regional head, I moved to start my own practice in 2009. All these years I was advising clients directly or indirectly.
What made you get into this profession? How did you start?
Mis-selling was rampant and the common man found it was very tough to differentiate between what was right for him and what was not. My job involved days when I saw investors suffering at the hands of the so called “advisors”. I was astonished to see that the Regulator completely ignored the quality criteria for the product sellers. Even today, those who are competent enough to give advice on personal finance are few and far between. With the agents, even manufacturers were trying to milk naive investors. It was really painful to see when a client was mis-sold for minor benefits. Then the day came when I read a book “The New Financial Advisor” by Nick Murray where he shared that financial planners do great work for society. He says ‘The whole population is sick. You have the power to cure it.’ The name of my firm “Ark” is also inspired from the same book. I think the unbearable pain faced by clients and motivation from Nick Murray forced me to start my own practice so that I can bring some change.
What challenges did you face which the CFPCM certification helped you overcome?
In the early stage of my career I faced a very big problem – everyone was talking about only investments be it my employers or even the clients. I realized something is wrong and there is a big gap between what clients should get and what they are offered. Few companies and agents started coining the terms “Financial Planning” and “Financial Planner” but it was misused to push their products. The planning part was completely overlooked and that further added to confusion in mind of clients. But as I was not having any formal education/training about financial planning – I never put the cart ahead of horses. Once I completed my CFP there was a sea-change in my thought process. My practical experience of the investments and firsthand experience of client communication, when combined with the CFP certification learning made me a more comprehensive financial planner. At this point, I would say that the challenges have not stopped. We still interact with clients who are confused at what we do. But the CFP education helps us a lot to create our own place and bring recognition to the fraternity to which we belong. People who think that CFP course is only about calculations or learning few concepts are totally wrong. The course is designed in such a way that it starts with learning the overall process, establishing practice, soft skills and lays code of ethics which are important for a practicing financial planner.
How would you suggest a common investor ensure that their accounts are protected and not invested in dubious instruments?
Best way is one should have a written financial plan .This helps in two ways. First is that your focus moves away from – “What is new in the market?“ to “Will this product be helpful to achieve my goals?“ Secondly, it will eliminate the risk of mis-selling as the advisor is giving recommendations in writing.
Has the no-load regime affected your business?
Yes it has; but in positive way. This was a path breaking decision by the SEBI. It was very much required. Clients now know they have to pay for the advice but how much, is still a general question. Earlier in India fees for advice was an unheard word for clients. Once a person knows he has to pay, he starts looking for advisor who can guide him in a right way & at right price.
What is your take on current market situation? What are the key factors that will drive the stock markets in 2012? What is your advice to retail investors now?
We work on asset allocation model & hardly concentrate on day to day market ups and downs. Even we ask our clients to keep their eyes on goals rather than markets. Timing market or checking its direction is futile exercise which is not actually worth anyone`s time & energy. India is a growing economy and its equity markets can easily deliver twice of actual inflation figures in next 20 years. Equity gives returns in long term but will investor will be able to get it? Investor`s financial behavior will answer this question.
What is your outlook towards Practice Management?
We believe in any business if you have integrity, nothing else matters and if you don’t have integrity, nothing else matters. Ethics & integrity are of immense importance for the financial planning profession and it is the core of our practice. Our practice management is evolving every day and the direction is towards building more trust with clients. On technical side of practice management we are trying to use the best technology available be it for data management, CRM, risk profiling or investment research.
- Occupation: Almost 80% of our clients are salaried
- Age: 80% of the clients are under age of 40
- Location: 40% of our clients are NRIs and the remaining 60% from metro cities in India
We prefer working with young salaried people as they want to learn and respect advice. Also we are advising a lot of NRI clients; this has helped us in understanding their requirements and we have developed a smooth process to service them.
Is there anything else you would like to share?
We wish to say that financial literacy is very important as we miss this in our education system. We dream for a day when investor will be financial educated before he reaches his financial advisor. Financial literacy is the key to financial freedom. Being financially aware means client will understand his questions and will also understand the solutions. It is really painful to see when a client is mis-sold for penny benefits. And best way to avoid mis-selling is to get armored with financial literacy.