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Financial Planning ‘I was able to switch my client’s money from insurance and real estate to MFs’

‘I was able to switch my client’s money from insurance and real estate to MFs’

Nikhil Thakker and Deepesh Mehta share their clients’ success stories and how their advice has helped them fulfil clients’ financial goals.
Banali Banerjee Sep 17, 2016

Nikhil Thakker, We Care Investments

In 2006, a businessman approached me to invest Rs. 1 crore. Since he had a 10-year investment horizon, I invested the corpus in a mix of diversified equity funds.

While he had invested for the long term, he got impatient when the markets went down in 2008. I recommended him to stay the course but he failed to understand that equity funds fetch good returns over the long term.

I had to redeem his money during the 2008 crash. “I consider it as one of my failures because my advice could not change the client’s perception,” says Nikhil. He invested this money in bank fixed deposit and stopped investing through me.

After a few years, he approached me again when his fixed deposit investments had not fetched him good returns. He realised that MFs are better products and he wanted to invest in mutual funds again. However, this time I warned him that he needs to stay the course during the ups and downs in the market. Also, I made him invest in debt and hybrid funds so that his portfolio was balanced.

I realized my mistake was that I had not recommended him to invest a part of his corpus in debt funds earlier.

Deepesh Mehta, Grow Wealth

I was very young when I ventured in this profession and did not have many leads. During that time, I met a prospect who used to work in a real estate firm.

He was in his early thirties. After we discussed his finances for an hour, I discovered that he had not planned for his goals.

I advised him to do a SIP of Rs. 5, 000. As days progressed and our relationship became stronger, I discovered that he had inherited two properties and had also invested some money in insurance to save tax.  

After a lot of persuasion, I managed to stop his investments in insurance. He realised that his agent cheated him by selling too many life insurance policies as well as Ulips which was not aligned to his financial needs. In the five annual reviews (2010 to 2014) I kept educating him on why real estate is not such a good investment. I did a comparison of real estate with equity mutual funds and made him aware of the disadvantages of real estate like lack of liquidity, stamp duty, maintenance costs, taxation etc. Convinced, he sold his two inherited properties in Bangalore and invested that money in mutual funds. His investments in mutual funds have fetched him good returns.

Later in 2014, he decided to leave his job to start his own business. I advised him to have a contingency fund for his business which he has funded through his mutual fund earnings.

I was able to change his perception about real estate and helped him switch to mutual funds. Currently, his mutual fund portfolio is in crores and he has referred me to many HNI clients. 

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