Pune based financial advisor and author of the book ‘Prosperity through Mutual Funds’ Arvind Paranjape shares his experiences with Cafemutual.
What inspired you to get into financial
advisory?
I am a Cost & Management Accountant and Company Secretary, having worked in the industry for 20 years before starting my advisory practice. I have had diverse experience in finance, costing, software and as a Company Secretary in a few listed companies.
Even before starting advisory business, I was adviser to my friends and relatives for shares and mutual funds. I was running a syndicate of 25 persons on whose behalf I used to invest in the share market. Over time, I started enjoying it and decided to convert my passion into my profession.
What kind of teething trouble did you face? How did you overcome them?
Since I was conversant with capital markets, having handled the issuance of shares and worked with companies and banks, I was quite knowledgeable about mutual funds. However, there was an apprehension that since I was a professionally qualified accountant having worked for corporates, should I work as an adviser for individuals? But after a few days I was convinced that I could add value to my clients with the help of my knowledge and professional outlook.
How did you go about acquiring clients?
My wife being a practicing Chartered Accountant helped me in getting some clients who wanted to do their tax-saving investments.
Clients came by word of mouth publicity from my existing clients. Also, I have been writing in local newspapers and conducting investor awareness programs.
Tell us about your business model? What kind of services are you offering?
It is one-to-one advisory model. I try to understand the mind and needs of the clients, for which listening is essential. After that I suggest a financial plan and asset allocation suitable to them. I encourage them to think and caution them on the potential risk. I take only a limited number of clients so that I can give proper advice and service.
What were your biggest learnings as a financial advisor?
Patience is the key in this business. Adviser should have conviction in the asset allocation model and the investment schemes he suggests. Client’s interest should be is paramount and an adviser needs to educate him; particularly when he is not behaving rationally.
Please share a memorable moment in your financial advisory journey
Helping clients reach their financial goals is always memorable and there are many such instances. It is a satisfying moment when lower income clients are able to accumulate wealth for daughter’s wedding or for their retirement. When my maid servant and her rickshaw driver husband could build a house of their own from the money invested through the 2 SIPs of Rs. 3,000 each, it was a tribute to the Indian mutual fund industry.
You are also into classical music…
I am passionate about Indian classical music. I am a tabla player. I have been practicing this art from my childhood. I organize and participate in classical music concerts (vocal, sitar, violin and Kathak dance) in India and abroad.
How did you get the idea of writing a book on mutual funds?
I got encouraging feedback from investors when I wrote articles in the newspapers. Even some advisers posted my articles on their office notice boards or circulated to their clients. Also, I could not find a book which explained to a layman what he needs to do for creating wealth. I wrote my first book in Marathi which was published in 2008 by Sakal media group. Around 5,000 copies in 3 editions have been sold, including in rural places. I’m planning to write the 4th revised edition. Its English version “Prosperity through Mutual Funds” was published in 2014 and that is also being well received.
What is your key to success?
I am a follower of the management guru Stephen Covey’s habits of effectiveness. I also conduct workshops on the same which has helped me in determining and realizing my mission. Also, as I am born in a family of artists, I inherited literature and art. That is the reason I wrote my book in a story format. With the help of my family members I have produced a series of 12 episodes on investor education on FM channel. This was an edutainment serial in which investment concepts were explained with the help of real life examples.
What are your plans?
Spread awareness about mutual funds. I feel that the middle class and lower middle class need to create wealth. They are not aware about mutual funds and are risk averse. I want to reach out to those people and enable them to create wealth through mutual funds.
Also, I urge AMCs that they should not merely focus on increasing their profitability. They should focus on reaching out to the “Aam aadmi” who really needs mutual funds. The AMCs’ incentive schemes encourage advisers to target big ticket size customers and go on foreign trips. I believe that “inclusion” is not a word to be used only in seminars but the MF industry has to work together to achieve it.