Purpose + Money = Happy Rich clients and MFDs, believes Amar Pandit, Founder of My Financial Advisor and the Happyness Factory.
Amar said, “As an MFD you must help your clients to live a life that they desire. Focus on ROL (return on life) and not ROI (return on investment). The value chain typically comprises the commodity (stocks), products (mutual funds), experience (financial planning) and guided transformation. The advent of technology has made investing in mutual funds easy. As a MFD, you can make a difference when you play the role of a financial planner and a guide.”
Amar was speaking on creating happy clients at the Aditya Birla Sun Life Mutual Fund – Cafemutual webinar series 'Lessons from the Masters'. KS Rao, Head Investor Education and Distribution Development, ABSL Mutual Fund moderated this session.
Here are some of his key insights of the session:
- Deal with people and not their money – You must not perceive your business to be product-centric. It is about managing the investors and their trust. First and foremost, it is important to decode why is the client wanting to invest. You can then determine the investment avenues in line with your client’s goal.
- Set the expectations right - It critical to set the expectations right from the beginning. There should be no gap between client expectations and your value proposition. The clients must be walked through the possible risks associated with a particular investment. You must share various scenarios and the magnitude of things where events can turn unfavorable.
- Don’t be apologetic – Volatility is a part of investing and you must not be apologetic when the market corrects itself. You must be a guide to your client through the changing landscapes. This helps in creating happy clients for a lifetime and not only for one time.
- Do what is right for the client – MFDs play a powerful role in the life of investors. Ensure proper asset allocation and goal planning. Aim at creating a GPS portfolio. A portfolio that supports your client’s growth, protection and spending (GPS).
- Make your clients think – The art lies in not speaking but asking great questions. Ask your clients ‘What is important to you about money?’ This may bring out some past events and trigger certain emotions. This aids you in creating an emotional connect and you can walk your clients through a meaningful conversation. Also, the clients usually do a basic check before approaching any MFD. You must encourage your clients to speak to be able to understand them better.
- Design a welcoming office – Create a friendly experience for your clients when they visit your office. The office design and aesthetics can aid in creating a happy client experience.
- Design the value proposition – Customize your offerings to suit your client’s needs. You create value when your client finds answers to these four questions – Am I doing ok? Am I on track? How much is enough? What do I need to do to be on track?
- Accept change as an opportunity – Change is not a threat to survive but an opportunity to capitalize. Work towards creating the next best practices. It is also important to enhance your skills as you must strive towards being better while trying to be different. You must be the best at what you do.
- Have defined processes – It is important to have a pre-determined set of processes in place. The designed processes must take into these parameters - risk, return, taxation, time horizon, liquidity, legal and unique situations.
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