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At the recent Cafemutual Ideas Fest 2025 (CIF25), Chennai MFD Ramalingam Kalirajan of Holistic Financial Services won the Sanjeevani award under the category of "Impactful." This award was given to MFDs who help families escape a debt trap.
Rohit Mattoo, Head – Retail Sales, Axis Mutual Fund, and Prem Khatri, Founder & CEO, Cafemutual felicitated Sanjeevani MFDs/RIAs who acted as 'Sanjeevani' for their clients by guiding them through difficult financial situations.
Ramalingam started his journey as an MFD 25 years ago. Among his 600 clients, around 50 were in a debt trap. These clients not only repaid their loans but now have a mutual fund investment portfolio of Rs.20 crore. Ramanlingam currently manages AUM of Rs. 366 crore AUM in mutual funds.
Cafemutual spoke to Ramalingam to know he helped investors manage debt.
Make clients for life
Many MFDs avoid dealing with investors who are in a debt trap as they cannot invest a substantial amount in mutual funds. However, once you help clients dealing with tricky pitfalls of a debt trap, they will remain your clients for life. Citing an example, he says that many clients who were in debt trap have been associated with him for the last two decades.
Approach to reduce debt
First step is to open a separate bank account for monthly expenses. "Earlier, people used to note their spending in a diary. But people have forgotten this practice. Hence, it is better to have a dedicated account to control unnecessary expenses. When spending is tracked, new debt can be avoided," he explains.
The next step is to note down the details of loans like outstanding amount, EMI date, timeline and rate of interest. This can help clients monitor their total liability and work towards accumulating a certain corpus every year to reduce debt.
Based on this, MFDs can create a repayment schedule. Ramalingam generally works out a loan repayment schedule at the end of the financial year.
Finally, Ramalingam also believes in the importance of family support. He advises clients to be transparent about their financial situation. "When the family knows about the debt, they can help reduce unnecessary expenses like luxury vacations or high-cost celebrations," he says. Family members may also offer financial assistance like pledging jewellery or withdrawing low-interest FDs to replace costly loans, he said.
Education on avoiding a debt trap
Ramalingam suggests that MFDs should guide the next generation of existing clients to create a habit of investing before indulgence. "Start grooming them from the age of 15. If they begin a small SIP of Rs. 10,000, by the time they turn 18, they will already have a decent portfolio. They can use this money to buy a smartphone or latest gadgets or fund a holiday," he explains.
This proactive approach can help young generations instil financial discipline, feels Ramalingam.
