Tell us about your early career. What inspired you to take up financial advisory?
I’m currently 43. I started my career at the age of 19. For the first four years of my career, I was into accounting and stock broking. Subsequently, I spent the next ten years of my career in a BPO where I joined at the entry level and got promoted as the vertical head. I quit my job at the age of 34 to pursue a career in financial advisory. This is my 10th year as an IFA.
I’ve always been interested in investing and the whole gamut of personal finance. I used to read a lot about markets and investments even though it was in no way connected to my career. I had a passion to be financially independent and help others achieve the same. Even while I was working, my colleagues used to seek my advice on many aspects of personal finance. So when I wanted to quit BPO, becoming a financial advisor was a natural choice for me.
Tell us about your initial journey. What kind of teething trouble did you face?
I was from a completely different industry. So I had to convince people that I knew what I am talking about. I enrolled for CFP and obtained the certification in a year’s time.
Client acquisition is the key for any practice. I started my practice in 2007 when the market was bullish and the popular trend was to invest in NFOs, book profits and invest in the next NFO and so on. We always have a policy of not selling NFOs. We encourage investing in equity through SIPs but in 2007, when markets were gaining a thousand points every month, nobody was willing to go for SIPs.
In 2008, there was blood on the streets. So people completely lost faith in equities. So it was a struggle for us for the first three years.
Tell us about your business model. How is it different from your competitors?
I’m an active blogger. Prospective clients approach us either through referrals or after coming across our blog. We have crossed half a million hits on our portal www.wisewealthadvisors.com. We have close to 4,000 followers on Twitter.
We focus on disciplined investing and have the largest SIP book among IFAs in Tamil Nadu.
How much assets under advisory do you currently manage in mutual funds? How many clients do you cater to?
We have a total of around Rs. 110 crore of assets under management in mutual funds. Our SIP book size is Rs.1.25 crore per month. We serve around 180 families.
What was your biggest learning as a financial advisor?
The average holding period of an equity MF investor is less than two years. Only 2% of investors hold a fund for 10 years or more and reap the benefit of compounding. To make our clients part of that 2%, the focus has always been on shaping their behaviour.
Our biggest learning is that changing client behaviour is the key for success. Product selection and asset allocation is only 10% of our job. 90% of our job is to mentor and shape client behaviour.
How do you win the trust of your clients?
Our conviction for equity as a preferred asset class and SIP as way to participate in the same comes from our heart. We sincerely believe that is the way for retail investors to participate in the India growth story and achieve financial independence. We walk the talk and practice what we preach. This helps us in winning the trust of our clients.
Going ahead, what are your future plans?
There are three significant trends at play now - regulations, technology and the shift to a fee only model. Despite robo advisors and direct plans, we feel there would be need for financial advisors. That is certain. What is not certain is what would be the viable model. So for now, we take each day as it comes. Over a period, once we have some clarity and certainty about future, we would evolve a plan.
Please share a memorable moment in your financial advisory journey...
What gives us pride and happiness is that all our clients are disciplined SIP investors and stay the course without any break. In the next few years, we will have many clients completing a decade of holding a portfolio built purely through SIPs. While the industry has only 2% who stay beyond 10 years in a fund, almost all our clients would be part of this category. Majority of our clients would belong to this precious minority. This is most memorable for us.
Your advice to budding IFAs
Stay focused on making your clients financially independent. IFAs always look to change their focus and the transition from one model to other is always painful. Try to save and create a corpus equivalent to three years of your expenses. This would provide psychological strength and serve as a buffer during the period of transition.
