How much time in a year do you spend with your financial planner ?

I recently came across a case with a client of mine who had signed up for financial planning and his progress on the case lead me to write this article. My client signed up with me and spent a viagra of energy on the initial discussion of his financial situation.

I was impressed with the zeal and energy shown but soon after the plan was issued out for implementation, I saw the time and interest given to this activity dip. Over a period of time, despite my several gentle calls and email reminders, my client always struggled with taking out time for his financial plan – as a result the implementation of all the activities has been stuck in a limbo, much like the government of India’s grand plans to bring the economy back on track.

So the million dollar question which I began contemplating on is – How much time do you spend with your financial planner ?

I don’t have a financial planner !

Well, you can do yourself a favour and get one. It might be wise to read on what is financial planning and understand what it could mean for you. No doubt, it is a darn boring exercise but you need to understand the importance of financial planners in your life.

Talk to people who have adopted the fee based concept of financial planning and get a feel for yourself whether it could help you – if your answer if no, people like me will be going out of business. If you need one , do check the list of certified financial planners in India to sign up with one of them.

And before you zero down on one of them, ensure you are aware of questions to ask a financial planner.

You have a planner ?

Perfect ! I like you.

During Planning

Now like everything new that you come across in life, your interaction with your planner will start on a high note as your expectation from the exercise can be huge and varied. After you have put in the initial time on discussing your financial data with your planner – things like, your assets and liabilities, your income and expense statement and your future financial aspirations in life, the planner will issue out a financial plan to you.

This is the initial phase of discussion where you put the maximum time with your planner. The planner should be able to put himself in your shoes to understand how you, the client/investor, would think on financial matters. Both of you would go back and  forth on getting a plan cut out that can be implemented.

This can easily be a 2 hour to a 15 hour activity, depending on (1) how much time you spent on digging out all your details in the format the financial planner asked for and (2) how many hours both of you spent on discussing your financial disposition and the plan as it was carved out.

During this exercise, please make sure you do the following.

• Share all your data – Many investors do not want to share all their data with their planners as they think the planner can do with some minimal data. Now that is an absolute disaster. If you hide anything from your financial planner, he will only make a plan that is not in anyway practical to you – that plan will fall short and will sputter in implementation.
• Involve your wife – The wifey often provides some sane inputs that the gents miss and often they know better how much the groceries cost – the total effort spent by both of you will surely go up but at the end of the day what matters is correct and critical inputs in the financial planning process rather than how much time you spent on doing it.

During Implementation

Post the issuing out of the plan, it is important that you keep the tempo high – if you falter on the implementation of the plan, then the fees you paid to your planner is a waste. Now, make no mistake, implementations will involve a lot of time as well.

This is the phase where you, the investor spends more time than does your financial planner in the implementation.

• Insurance – If you are taking term insurance, trips to a local hospital for medical might be required. Then you might need to furnish some documents like IT returns, address proof and identify proof. You might need to dig out historical information of your family’s illnesses which need to be keyed in for a health insurance plan. Not to mention a photograph which often, according to Murphy’s laws, won’t be readily available with you. These take time and an investor needs to be patient while he does this.
• Investments – If you have been advised by your planner to invest in mutual funds or stocks or gold, then you can either do that at the click of a mouse via the Internet. This is easy but for those who need to do offline investments, you again need to spend time with your local agent to fill up forms and do the Know Your Customer guidelines, if you haven’t already done one earlier.

During these two exercises, you will need to go back to your financial planner to take some hand holding and steer. The time you spend with you planner here could again be 5 hours approximate, depending on whether your planner is helping you with the investments or not.

This is where it all fizzles out because this requires dedication, time and interest. Stay straight on this course and you would have won the race.

During Review

Post implementation, you and your financial planner need to get around the desk to do some reviews of how you are progressing – this might require some prodding on the part of the planner but if you get the implementation out of the door, you have done the needful to a great extent. Review, depending on how many you do in a year, might require a maximum of 5 hours.

Conclusion

To wrap it up, the more amount of time you spend with your planner, the better it is for you. You need to be careful on not inundating him with so many questions that he does not want to retain you but a healthy mix of time over the planning, implementation and review is a must.

By the calculations above, you would have spent a maximum of 24 hours in a year on your investments with your financial planner – 1 day in a year !! In many cases, it is still on the lower side than this – please do not construe this as a thumb-rule or guideline – every individual will have different hours that he spends with his financial planner.

Can you take out that much time for your financial well being ? I am sure we all can !! So what’s your take dear readers ?