August 26, 2011

Hello Planner! Do YOU have a Written Financial Plan?

Sadique Neelgund

“Practice what you preach” is a popular adage that we have heard since our school days. How much do we believe in this? And how much do we follow this?

Many Financial Planners/Advisors including 1500 CFP Certificants know the benefits of having a Financial Plan and also getting it done from a professional who can give unbiased & rational advice. And we go out and preach our prospective clients the same.

During my 3 day workshop on “Comprehensive Financial Plan Construction using Excel”, I invariably ask two questions without fail to all the participants who will be venturing out to make financial plans for their clients and charge a fee for that service – “Do YOU have a Financial Plan?” followed by “Do YOU have a WRITTEN Financial Plan?”

A question many advisors would shrug off or make excuses given the fact that most have a negative answer to these 2 questions. But then YOU are also an individual with a family filled with aspirations, right?

Do YOU have a Financial Plan?

As a financial planner, it is very important to have our own financial plans in place that too in black & white and preferably prepared by another professional.  We should go through this process before venturing out to plan financial lives of clients or preaching the benefits of planning to others.

Take the parlance often given by a prominent financial planner in India to drive home this point. Imagine going to a Gym to register for Workout Program and you find your to-be gym instructor FAT, lazy and eating some junk food while giving instructions to his customers! Run away? We would of course want our instructor to be fit, active & in shape.

The point is to lead by example. When we undergo the financial planning process ourselves – right from finding a good financial planner to data gathering to presentation of a financial plan to monitoring it – we undergo many emotions and anxieties.

By undergoing the process our ability to emphasize with clients increases, our conviction to convince clients to get their financial plan done for a fee increases, our outlook to non-financial aspects of a family broadens as financial planning is not just about finances.

Our clients should admire us as a smart money manager – as a person who is walking the talk! When I approached a CFP Practitioner to get my financial plan done 2 years back, I was completely unaware of the practical aspects of financial planning.

The planner grilled me for 3 hours with questions which I had never thought of as an individual or even as a CFP Certificant. This 3 hour session changed my entire outlook to financial planning and gave me clarity as to what I wanted to do with the money that I was earning.

I use this personal example to persuade clients to give me time for data gathering meeting and explain how financial planning is different from what they have been doing so far with their money.

Having a Financial Plan has benefits on 2 fronts for us as a Financial Planner;

  1. We will have a professionally written Financial Plan which is a disciplined way of managing money, get an opportunity to clear up the mess which we may have created and get clear directions for future course of action.
  2. We will appreciate the value of professional financial planning services and will have more conviction in convincing prospective clients and empathize with them while taking them through the financial planning process.

Do YOU have a WRITTEN Financial Plan?

I assume most of you who are reading this are CFP Certificants or Financial Advisors. Need I address this question? But I also know that most reading this don’t have a written financial plan for themselves, although you may say that the plan is in the back of your mind!

Now, either ways ask yourself these questions;

  1. Have you written down all your goals in life? If yes, have your quantified them in terms of present value and future value taking into account assumptions.
  2. Have you mapped each of your existing assets like mutual funds, insurance policies, fixed deposits, post office schemes etc to one of your future goals?
  3. Do you know what kind of fresh investments are required to fulfil your goals and are they currently happening? What if you don’t have the surplus to invest for your goals?
  4. Are you holding on to any wrong investments? Many times advisors buy insurance policies of which they are agents. But are they the right policies for you?
  5. How does your long term Life Cashflows look like after incorporating income growth, inflation and fulfilment of all goals. How does the surplus look like in each year?
  6. Are you adequately covered – Life, Medical, Disability, Critical Illness etc. Do you know the exact insurance required based on Need Analysis Method?
  7. What if you lose your job or there is business loss or reduction of income? What’s the backup plan?
  8. Do you have all the details of your personal finances in one single document? Life becomes easier when you put the blocks together and see the bigger picture. (Try it)
  9. Has your spouse been involved in money decisions? Does s/he know everything about the money matters in the family? If both are working, is there a synergy in your spending/investments?

If YOUR answer to any of these questions is NO think again about your aspiration to become a Financial Planner yourself. Having a plan at the back of your mind is okay, but if you put it all on a piece of paper (word/excel file), you really get a grip of finances, refer to it for taking actions and also monitor your progress.

And more importantly you can put all the blocks of your money matters in one place and connect them to each other. Having a WRITTEN comprehensive financial plan is anyday better then working on single goals or separate components of your personal finances.

Why should YOU hire a professional financial planner?

I am emphasizing on YOU because the person in question is a CFP Certificant/ Financial Advisor! So with all due respect to our knowledge, analytical skills and financial prudence, I would still say that hiring a financial planner may be better than doing it yourself at least for once.

I had earlier written about Do it Yourself Vs. Hiring a Financial Planner, making a case for both the pathways. Check it to see what is right for you and take an appropriate call for yourself. Still I would urge financial advisors/planners to get their plan done from a professional and go through an elaborate process for the following reasons;

1)    Get a Second Opinion – We all have blind spots. There are personal biases when we take decisions for ourselves. But we can expect objective advice from a professional. This is usually the first feedback I have got whenever I have worked on financial plans of planners/advisors.

2)      Learn to trust your planner – When you go through a Financial Planning process, you open up all the personal details about yourself. You have never done something like this all along. It takes a lot of confidence & trust in your planner to share life’s finer details and talk to him/her about your past & future. This will in turn help you to seek trust from your clients.

3)      Learn to pay for advice – Writing a cheque of Rs.10,000-Rs.20,000 for pure advisory takes a lot of guts and faith in the person providing these services! Try for yourself how much a client will think before agreeing to cut a cheque for your fee-based advisory services.

4)      Get a professionally written plan – If you were to sit down to make your own plan, you are bound to procrastinate, modify assumptions as per your comfort factor, take biased decisions and maybe not involve the spouse. When you pay up, the planner is responsible for these things, s/he pushes you to think and act objectively. You also tend to listen & act on others advice than your own wisdom or your spouse thoughts! Hiring a professional can also prove useful to convince your spouse & family members to live a disciplined life although you as an advisor/planner may believe in the same

5)      Undergo the process – The process starts with finding a good financial planner, understanding terms of services, deciding on the fees, data gathering which can run into 2-4 hours, organizing all the documents, the planner analysing and coming out with recommendations, presentation of the plan, modifying the plan for discrepancies/updates, taking actions, monitoring the progress and actually finishing with fulfilment of goals. Now recollect if you have ever undergone this process or have taken any of your clients through it in a comprehensive manner?

How to get started?

It’s a challenge, a BIG challenge to find a good financial planner in India. And it’s good if you can test it out yourself and understand what the consumers must be facing to hire a financial planner. So if you have decided to get your own plan done, the first thing you need to do is hunt for the RIGHT PLANNER who is offering comprehensive, fee-based financial planning services without hooking you on to the products.

First, look around you and in your circle if someone is offering these services. If not, search for a planner in your city using CFP Certificants Directory published by FPSB India on its website or in Journal. You can also use the Profiles section on which contain details like services offered, CFP Certification Status, Email, Mobile Number, brief profile, website details etc.

Short-list 3-4 planners based on the services offered, experience, set-up, credibility, knowledge base, fees charged, recurring charges etc. Meet or talk to each of these short-listed planners before finalizing the one with whom you want to work. And most importantly be ready to pay fees upto 10-20 K which is the current ongoing charges by most financial planners.


If you have the expertise of offering financial planning services, be willing to take on clients from advisory community. Don’t be apprehensive about them learning your tools & techniques and think of them as your competitors. Financial Planning is individual driven profession, if you are good as a professional there is no dearth of prospective clients for right services.

Just imagine what kind of movement will start if all the 1500 CFP Certificants & other financial advisors subscribe to this concept and get their own financial plan done professionally from each other. And then approach the masses with absolute conviction about this novel profession.


Authored by,

Sadique Neelgund

Network FP Knowledge Solutions Pvt ltd

6 Thoughts to “Hello Planner! Do YOU have a Written Financial Plan?”

  1. abhinav0115 says:

    Hi Sadique

    Thanks for the article…very important and useful. Especially the point you mentioned about adjusting the projections as per individual comfort level…thats very true.


  2. I’ve truly had those entitlement discussions when using the Entrepreneurs with with whom I have counseled for all the direction decisions that they point. In time, We’ve reach consider them a large number of (not all) of the pay packages will be warranted. Here is the reason.

  3. Curry cashews Dr. Oz said all nuts aid weight loss, but the curcumin in the curry blocks fat storage.

  4. Require a strong yet 100 % functional property mower to aid conserve the property? Check out our website and discover your variety of inexpensive back garden mowers offered. Your selection includes popular kinds of lawn mowers, much like the Jon Deere grass mowers that you can buy and other. Basically stick to the links back to you and discover. after school exercises

  5. I simply want to tell you that I am just beginner to blogging and site-building and certainly liked you’re web blog. Almost certainly I’m likely to bookmark your blog post . You really have fabulous posts. Kudos for revealing your blog.

Leave a Reply

Your email address will not be published. Required fields are marked *