Our role is to convert goals to financial numbers, says Jawahar
Coimbatore: When Karthikeyan Jawahar, a Certified Financial Planner, sits to work with his clients, he takes up their case as his own and starts analysing. And, his firm – Finerva Financial Solutions Private Limited - offers several services from simple remedies to managing the clients’ portfolio and corporate training. In a city like Coimbatore that has just a handful of Certified Financial Planners and a large number of employees, such services come as a boon. Mr. Jawahar talks to M. Soundariya Preetha on the awareness and demand for financial planners.
“Our role is to convert goals to financial numbers,” he says. This is not a rocket science but simple arithmetic. But, the clients will have to be honest about their expenses, income and targets.
A number of Mr. Jawahar’s clients are those with a fixed monthly income.
“We have been into financial services for five years and of this, three years have been in financial planning. What inspired us to start the planning services was what we lacked when we were working in an organisation – guidance on how to manage our income, expenses and aspirations,” he says.
Such a service first creates awareness among the clients and gives the stimulus to plan. It gives clarity and makes it easier for them to decide how to protect and augment their wealth.
For instance, one of the free counselling sessions organised by the company was attended by a bus driver whose salary was about Rs. 6,500 a month. A matter of concern to him was Rs. 600 he was paying every month towards a personal loan of Rs. 30,000 taken two years ago. This was a burden as he was not repaying the principal but only the interest. After the session, he started setting aside just another Rs. 200 every month towards repayment of the principal and was soon able to close the loan.
On the need for such a service for all segments of the society, from businessmen to the salaried, he says financial planning is required more to create awareness.
There are too many products in the market now. Earlier, the options were limited. For instance, there are 17 life insurance companies and 20 general insurance companies and there is much competition and information in the market.
A number of financial products are innovative. Hence, consumers need to be educated.
A planner “hand-holds” a client. The other option is to have more financial education sessions. This helps in budgeting, however small the income, he says.
“Most of us now only plan for tax. But, that is a small portion of the entire financial gamut,” he says.
In the U.S., 80 per cent of finance is behavioural. If we can touch upon these factors, it brings about a lot of changes, he says. Financial planning service is a yet-to-be-tapped sector in the country. The challenge lies in spreading awareness about such services and making this affordable to all.
The number of certified planners is also not high as it demands commitment, time and passion towards the work. There is much to be read, understood and analysed from the market. Mr. Jawahar says he spends 10 hours a day on study and research.
(Financial Planning Services Board, with its head quarters in Mumbai, is the body that certifies financial planners on an annual basis).