Wealth Management

Wealth management is very straightforward. From the affluent individual’s perspective, wealth management is simply the science of solving/enhancing his or her financial situation. From the financial advisor’s perspective, wealth management is the ability of an advisor or advisory team to deliver a full range of financial services and products to a client in a consultative way. The most rewarding (Putting Client’s Interest first) of relationship between the Wealth Management & the client. It is all encompassing in terms of the financial needs, values & priorities of the Client.

The range of products & services provided to WM clients from Insurance Planning, Child Education, Retirement estate planning, tax strategy to liability management & Alternative investment products Just imagine a family that is heading for its vacation. There would, understandably, be much excitement. And even more background preparation. There would be Google searches for best Indian restaurants, calls made to friends about the best places to pick electronics. In short, every Indian family plans well before going on a holiday. What does this planning ensure? That we are adequately prepared for any emergency, or that we can maximize precious time, or strike bargains at ease. There surely are many benefits of a planned holiday.

Personal financial planning is no different. The benefits are enormous. But there are hardly a handful of us who actually practice this. Forget a detailed financial plan. Just the basics would do for starters.

Let us look at a checklist of a few important things that has to be kept in mind during financial planning:

• How much I earn as an income? Do I know my cash flows? Even something as simple as knowing the surplus at the end of a typical month is unknown to many.

• Do I have an idea of inflation? Inflation kills purchasing power and in many an expert’s opinion, the number one threat to quality of life.

• Are we adequately insured? Would there be income replacement if the any of the income earners expire or cease to exist.

• How much debt I do have now how I manage it ?

• How much of my income am I saving every month after providing all my expenses?

• Am I only saving, or am I investing? There is a huge gap between the two. Savings with a plan and goal is investing.

• How much money do I have in my savings account? And how much does it earn for me?

• Is there a retirement fund (Defined benefit/defined contribution)? Surely, let us not be under the illusion that children are going to help you around your retirement ?

• Who advices me on my investments? what is his/her credentials ? Is it a trustworthy professional or is it merely well intentioned thought and words from friends and relatives.

These are just a few questions that need strong and convincing answers. If your answer is a ‘No Idea’ to most of the questions listed above, then you need to get started on personal financial planning. Personal financial planning is very much a habit thing. Once you get started, it’s really very easy to continue. At least we will be at peace of mind.

For starters, become aware. Start showing interest in figures and terms like Inflation, Cost of Living, Future Value and Compound Interest. Look around to see which assets are now ‘doing well’.

Know the difference between Insurance and Investments.