Have you ever faced a Financial Advisor in a meeting about planning your finances and are surprised by all the information that you are required to provide? They ask about your Income streams, income earned by you (even which is not disclosed in IT Returns), your expenses, your current investments, your loans, and other financial liabilities, your insurances, and much more and not just your own but even your spouse or other earning member of your family. And you are like sitting there confused,
“Do I even need to share these?
Won’t just my requirements or goals work?” Or even you might think that, "Isn't it enough that I provide you the money I want to Invest and you tell me where should I put it?
Financial Advisory as a profession is not deep-rooted in India and thus people are not accustomed to Financial Planning as a service. Financial Planning has not reached everywhere professionally. It is being offered in bits and pieces yes, but not as a whole so when one decides to get their finances planned, they are stunned with the questions and information being asked to them. They feel a little uncomfortable disclosing their financial information to a complete stranger. Even if they are sitting with an advisor who they know by some reference, they still are not comfortable disclosing it fully.
Financial Planning is not just how much money you can give to advisors and how good returns they can provide on the amount you want to invest through them. This service is already being provided by Investment Advisors and agents in the market.
But if Financial Advisors are taking fees from you for their advisory service, it means they are providing something more than what others have to offer you. If your only objective is to earn good returns then there’s no harm in investing through Investment Advisors or Investment Agents.
What Financial Planners or Advisors offer you are all-around services of your finances which doesn’t include just investment of your funds but also includes assessing your financial profile which helps them determine your financial needs and how you and your finances are capable of fulfilling them.
Your information is the basis on which the calculations and assessments are based on and it helps determine the recommendations that the advisor provides you.
Financial Planning is a process and not one-time activity so it requires more information input and not just the reason why you are investing for.
So your financial numbers will help determine your risk profile, your insurance need, your capacity to provide for your future goals, funding your retirement corpus, funding bequest for your beneficiaries, and much more parameters. All though all these numbers are used to make a ballpark estimate of the finances of your future, providing it precisely will help you reach it easier than having to struggle for it.
Not disclosing it with the fear that it will breach your privacy and word will go around about your information is a legitimate worry but it has no base.
Advisors are bound to make a Non-Disclosure Agreement with the client and it states that the information will not be disclosed to anybody and will only be used for the Client’s Financial Plan. So don't get worried your data is protected with the Advisor.
Don’t take pain thinking about getting your Finances planned, all it takes is a leap.