Seven things you should look for in a financial planner

Harsh Roongta, Economic Times, 9/6/2011

Recently, a new breed of professionals has emerged who are making financial plans for everyone and are not restricting themselves to investment planning . A financial plan includes planning for your taxes, retirement, kids’ education and marriage, buying a home, estate planning or any other goals you may have. This new breed of professionals, known as financial planners, writes a plan for you with all your goals specifically laid down and then provides you with a road map on how to achieve these goals.

They always give you a holistic account of all your finances, taking into account all your assets and liabilities, besides taking care of all the risks associated with you and your family and also the assets owned by you. These financial planners will first collect all the data related to your finances and the goals you have for future. These goals may be anything ranging from buying a home, to planning for your child’s education to going on a vacation. After this exercise of data collection, the financial planner will analyse your goals and accordingly write a financial plan for you.

This financial plan will carry recommendations you need to follow as they will help you achieve all the goals. These financial planners may charge professional fees for making this plan for you. You will find various planners who can do this job for you. But how to choose a financial planner who can handle your finances in the best possible way for you? Below are seven pointers you can keep in mind while scouting for a professional who can write a complete financial plan for you.

1. The planner should start by collecting data relating to your finances, analyse your goals and then recommend through a written financial plan and not just recommend a plan to you without understanding either your finances or your goals. Your financial planner should provide you with a holistic picture of your personal finances and provide you with a road map for your finances rather than just trying to sell you products.

2. Ideally, you should always go for a ‘fee only’ financial planner. This will ensure that the planner doesn’t have any interest in selling any particular product along with the plan. Along with that, this will also make sure that the recommendations provided to you in the plan are completely unbiased and to your benefit. A fee-only financial planner will disclose his fees upfront.

3. The financial planner should analyse all your goals and take a holistic picture of your finances. Once the analysis is done, he should draw out an asset-allocation plan for your goals. All the product recommendations should follow the asset allocation suggested. The financial plan may or may not carry any product recommendation. In case the plan is carrying product recommendations, then be sure that you have an option of buying the product from any other broker or distributor.

4. The financial planner should be well qualified to take care of all the decisions concerning your money. You must verify if your planner holds professional degrees like a certified financial planner (CFP) qualification or chartered accountancy and has specialised in financial planning. Both knowledge and qualifications will build up your confidence in the financial planner and will assure you of good management of your money.

5. If your financial planner is suggesting you to buy products like a traditional insurance policy, then be sure that he is just trying to make money for himself through commissions for himself or some of his associates.

Stay away from a financial planner who suggests you to buy such dead products, which cannot be justifiably recommended by any financial planner.

6. Do some research on your planner and his reputation in the market. You can go on Google and search for his/her name.

A financial planner with good reputation will always be very popular with the media and you will find enough to read about them over the Internet.

7. Stay away from a financial planner who starts off with advising you a product without analysing all your goals. Most importantly, go with your gut feeling after the first meeting.


Personal Financial Planners Chennai, Personal Financial Advisors Chennai, Certified Financial Planners Chennai, Financial Planners, Fee only Financial Planners

2 thoughts on “Seven things you should look for in a financial planner

  1. The Money Paradise

    Yeah i agree with you that it always advisable to go for fee based financial planning as the planner will try to provide the best possible plan that can be possible for the type of risks, goals and finances available to one. Because in this way the planner need not to depend for the charge of services in form of commissions from selling financial products.


  2. rajan

    this is true. once they know strength and weakness there is every chance an investor can be duped. better keep 50% in fixed deposits and play with the other half.



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