An individual or family can work with a financial planner at any age and at any stage of life, or approach a planner, when feeling overwhelmed, confused, stressed out or scared by their financial situation. It is also fine to approach a planner from a position of strength to check that you’re on the right track and suggest possible improvements to your plan to achieve goals more effectively.

Some specific reasons when an individual or family should definitely take services from a financial planner are –

    1. None of your savings is invested or you don’t know how to invest –  Cost of living is always going up, any money you keep in cash or fixed deposits declines in its purchasing power over a period of time. Planned investing is the only way to ensure purchasing power increases with time to meet your life goals,  other option is to have an exceptionally high income.
    2. You have investments, but you’re consistently losing money – Overall investing should increase your net worth over a period of time. If this is not happening, then hiring a financial planner can help you find out what is wrong and correct their errors before it’s too late.
    3. You do not have insurance – If an individual is properly insured or the family is not sure about their insurance needs, a financial planner can offer you a better and more cost effective opinion than others.
    4. You don’t have a estate plan – A financial planner can help in putting together an estate plan to make sure your assets are handled according to your wishes after you die.

Financial planners can assist an individual and family in so many ways. Some of them are –

    1. Expertise. Financial Planners know more about managing money than most people. They can help in making better choices than one might make on their own.
    2. Accountability. Financial planners help an individual and family stay on track by talking them out of making emotional decisions about their money, like buying a stock that’s been skyrocketing or selling all your stock funds when the market plummets.
    3. Advice. Financial planners can make suggestions about various options to improve your finances about what investments to make to what insurances to buy.
    4. Evolution. As life circumstances change for an individual or family, a financial planner can help make adjustments to financial plan such that it always fits the current situation.
    5. Action. Many individuals or families don’t take the steps they should to manage their finances because they’re too busy or too uncertain about what to do. Working with a financial planner means someone else can handle what one don’t have time for and make sure their money is deployed in the best way.

Once your investments are in place, an individual or family will receive regular statements from their planner updating them on their portfolio. The planner will also set up regular meetings to review their goals, overall progress and to answer any questions they have. Meeting remotely via phone or video chat can help make those contacts happen more often. Further, it is important to consult with your financial planner when an individual or family anticipates a significant change in their life that might impact their financial picture, such as getting married, adding a child to family, buying or selling a home, changing jobs or getting promoted.

How different financial planners get paid

Financial planners build their business using either one of three standard business models. These models are listed below –

    1. Commission only based model – In this model, financial planners get on commission for the products they sell to customers. This means the customer may never receive a bill from the financial planner. On the other hand, customer generally end up with financial products that charge higher fees than others in the market – to pay the planner a high commission for putting clients into them.
    2. Fee only based model – In this model, planner charges customers a fee for the amount of work done or as a percentage of assets under management. A typical percentage fee ranges from 1% – 4%, while a typical fee for financial planner ranges from INR 10,000 to INR 30,000. Fees vary by the location and by planner’s experience. Some planner may offer lower rates to help customers who are just getting started with financial planning. An initial consultation is often free and provides a chance for both customer and planner to see if they’re a good fit for each other.
    3. Hybrid model – In this model, financial planners can charge  both direct fees and earn indirect commissions from their customers. Here the planner may earn a fee for developing a financial plan, and also earn commission for selling a certain insurance product or investment.

A fee-based financial planner with hybrid  model is not the same as a fee-only financial planner. A fee-only financial advisor earns no commissions and has no conflict of interest while working with individual and families .

Overview to Digital financial planners

Information Technology has had a positive impact on many industries.  Improved connectivity, better access to information, faster service, etc.  It is now starting to make a difference in financial planning industry. Today we have digital financial planners (or robo-advisors). A digital financial planner is one that uses a computer program to create a financial plan and to manage money.  This program asks individuals and families to answer a given set of questions about their understanding of money, goals and their emotional ability to handle losses. A digital financial planner is very cost effective in comparison to human financial planners. They are easy to understand and use. They can save an individual and family lot of time, money and take the emotions out of investing. 

However a digital financial planner cannot speak to an individual or family about the best way to get out of loans or fund their child’s education. It also can’t talk to an individual when they sell their investments out of fear rather than holding it for the long run. They typically are used to invest clients’ money in a portfolio of index funds or mutual funds or to track a market index. 

Now with availability of digital planner an individual and family have still more choices to choose from of these three options as shown below –


Not all financial planners have the same level of training or will be able to offer the same depth of services. So when contracting with an financial planner, an individual or family should first do their due diligence and make sure the planner can meet their financial needs. A planner can have all the experience, credentials and success stories in the world, but if an individual don’t like their financial planner, then ultimately financials will suffer. The key to developing a successful, long-term relationship depends on finding an planner who is the right fit for one’s personality.   

For more information please feel free to reach out to us via email at – or by phone – 91-9515475381. 

Next Article – Risk Profiling : One’s ability to handle loss and sleep peacefully

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by any entity prior to publication.

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