How to choose a financial advisor in India

Choosing a financial advisor / planner in India is little tricky. First of all some call themselves as financial advisor, some financial planner and some call themselves as investment advisor. Then there are others who call themselves as wealth managers so on and so forth. So it becomes very tricky for an individual to deal with this because you got to have the right keyword to search for the list of people providing this service. I usually use Google or Justdial for searching. Once you have the list of the people shortlisted then maybe you can speak to them to evaluate and decide what and how they can help you in this regards. My advice would be that you search for different keywords while searching for a financial planner.

financial advisor in India

I tried to do an experiment where in I contacted financial planners / advisers and tried to evaluate them. ¬†In my experiment I used Just Dial as I am bit lazy ūüė≥ . I called Just Dial and ask them that I am looking for a financial advisor . Just dial sent me a bunch of numbers by SMS and few minutes later I started getting several calls from so called financial advisor / planner. ¬†In my conversations with them I asked them about their qualification, I also asked them that if they can give me couple of case studies or the plan that they have prepared for others in past after taking out any Personal/confidential information. I also asked them give me at least two reference customers. ¬†This way I could evaluate if they are really telling me the facts or simply selling a rosy picture.

I used to work for a IT company and whenever we used to sell anything to the customer, the  customer would ask for POC which is proof of concept. This is to demonstrate to the customer that whatever we are claiming that the software would do, we needed to actually prove it to them in this small POC.  I tried to use the same reasoning while trying to select a financial planner by asking for above information.

Out of the 15 phone calls that I received most promised me that they will send me case studies and customer references. It has been since 4 days and I have not received a single case study or a customer reference.

This kind of showed me how difficult it is to find the right skilled person as there is too much  mis-selling in this field. I will continue with this post and list out the factors that you should consider while selecting a financial advisor / planner.


This is in continuation to my to my blog post from yesterday

Following are the factors that are key in  in shortlisting a financial advisor / planner


The person should be either be a Chartered Accountant (CA ūüôā ) or a Certified Financial Planner or an MBA Finance from a reputed college. He could also be a Certified Financial Analyst which is a CFA.¬†People with above qualification are certified after thorough testing and they possess a very sound understanding of finance.

For person claiming to be a Chartered Accountant (CA), ask for his membership number which you can cross verify here or alternatively ask to see his certificate of membership. And for person claiming to be Certified Financial Planner (CFP), you can cross verify here

I would recommend to go with a Chartered Accountant (CA) who are members of the Institute are known as Chartered Accountants. Becoming a member requires passing the prescribed examinations, three years of practical training (known as articleship) and meeting other requirements under the Act and Regulations. A member of ICAI can use the title CA before his/her name. The Institute of Chartered Accountants of India (ICAI) is the national professional accounting body of India. It was established on 1 July 1949 as a statutory body under the Chartered Accountants Act, 1949 enacted by the Parliament (acting as the provisional Parliament of India) to regulate the profession of Chartered Accountancy in India.

Various Government Dignitaries such as Finance Minister and Prime Minister regularly interact with the body of CAs. See couple of videos here. You would not see them addressing any CFP or other institute.


Person should have good industry experience and he/she must had spend some time in the industry. They should also have Knowledge/Expertise in the following areas:

  • Taxation

Taxation a key aspect in financial planning and it is important to understand client’s tax situation and how to optimize his tax profile to save maximum money.

  • Insurance products

Person should have detailed understanding of various insurance products such as Health Insurance, Life Insurance, Accidental Insurance, etc. Financial planning involve taking care of your insurance needs first so as to minimise your  your risk with respect to health, life and other unforeseen situations. In Indian context this becomes critical as unlike in the western countries like USA, Canada, etc we do not have Social Security which basically means there is NO Safety Net, hence there is urgent need to plan for contingencies.

  • Goal Based planning

Some of the common goals in Indian ¬†context are fund requirement for children’s education, children’s marriage, house purchase, foreign vacations and finally retirement.¬† A good financial planner will help you in deciding upon your goals and will also help you in estimating realistic cost for this goals.

  • Financial markets

A good financial planner will have a deep understanding about financial markets and the various products available in the market as you may be aware there are Debt products such as Bank FDs, Cooperate FDs, Debt Mutual Fund,  Liquid funds,  Short term funds, Government Bonds, Tax-free bonds etc. Similarly there are wide variety of Equity products and alternative investments. There are also various retirement schemes such as PPF, NPS, Employee Pension Fund et cetera.

  • Estate planning

Check whether your advisor has sufficient knowledge about Estate planning, this involves writing of Wills, Nomination Procedures and Probate. He should also be able to do proper estate planning for you. A good advisor make you aware of critical aspects such as Nominations in case of your assets like real estate, stocks, bonds, fixed deposits, bank lockers etc. Do you know it costs around 75,000/- for a Succession Certificate if NO Nomination is in place? Have you made your will? Have your parents / grandparents made their will?


It is important to ask if the person also possesses required licences such as RIA licence (stands for registered investment advisor) and is given by  SEBI. Also see above discussion on Education which is closely linked to this topic.

Source of Income

You should also try to understand what is his/her primary source of income? Are they earning money from advisory  fees or they are getting Commission from the financial products that they are recommending? There are some financial advisors who charge fee and also get Commission. I would suggest to go with an advisor who is only charging advisory fee and is not getting any commission from any product. This way he will be completely unbiased towards any particular financial product / instrument.

One Stop Solution:

A good advisor will be able to give you one stop solution for everything. They should be able to handle all your financial issues, be it taxation, insurance, retirement planning, college education etc. I have met some very good financial advisors who also provide counselling around colleges/university for children’s higher education, help in resolving family disputes and even advise you in your business affairs.

So it is recommended that you do through due diligence before you finalize financial advisor to  to achieve your financial goals. Wealth creation and Wealth Management is not a short term process and it involves long term planning and execution. It is better to deal with professionals who are ethical to ensure your bright financial future.

Here are some questions to ask the financial planner before you start.

Questions to ask a Financial Planner before Engaging them

While looking out for a  good financial advisor, Consumers  should ask below questions listed before making final decision.


  1.  How much experience and what experience do you have?

Look for a financial advisor who has Taxation, Insurance РHealth, Life and Accident, Investments, Financial planning, retirement planning and estate planning experience at a minimum.  

Additional expertise such as Counselling on college education, Counselling on purchase of real estate, Process of obtaining home loan, Ability to deal with / help you in terms of Employee Provident Fund, Gratuity and Pension is a BIG PLUS.


  1. What are your qualifications?

As mentioned above check the education of the person, That person should be either be a Chartered Accountant (CA) or a Certified Financial Planner or an MBA Finance from a reputed college. He could also be a Certified Financial Analyst (CFA) from CFA Institute of America.  (Note of caution: Some people claim that they are CFA but actually they have just completed a course from ICFAI india which is just some college in Hyderabad and not true CFA.) People with above qualification are certified after thorough testing and they possess a very sound understanding of finance.


  1. What services do you offer?

The services a personal Financial Planner offers depend on a number of factors including credentials, licenses and areas of expertise.


  1. What is your approach to personal Financial Planning?

Ask the personal Financial Planner about the type of clients and financial situations he or she typically likes to work with. Make sure the personal Financial Planner’s viewpoint on investing is not too cautious or overly aggressive for you.


  1. Will you be the only person working with me?

Ask about the person who will be actually working on your case. Is it going to be somebody else in his organisation or himself? If its  somebody else then does that person have the enough qualification and experience? Many a times the person whom you speak would be just the front facing Marketing person and the people actually doing the work could be an inexperienced individual.


  1. How will I pay for your services?

As part of your Financial Planning engagement, the personal Financial Planner should clearly tell you in writing how he or she will be paid for the services to be provided.


  1. How much do you typically charge?

While the amount you pay the personal Financial Planner will depend on your particular needs, the planner’s level of experience and your geographic location, the personal Financial Planner should be able to provide you with an estimate of possible costs based on the work to be performed.


  1. Could anyone besides me benefit from your recommendation?

The planner may also have relationships or partnerships that should be disclosed to you, such as business he or she receives for referring you to an insurance agent, accountant or attorney for implementation of the Financial Planning recommendations.


  1. Have you ever been publicly disciplined for any unlawful or unethical actions in your professional career?

Ask what organizations the planner is regulated by and contact these groups to conduct a background check.


  1. MOST importantly – Can I get everything it in writing?

Ask the personal Financial Planner to provide you with a written letter of engagement that details the services that he or she will provide. Keep this document in your files for future reference.


What Is Their Importance?

A financial advisor / planner is the one who should guide and work on behalf of the investor / client. As mentioned above, the advice is primary whereas the product takes secondary status in a relationship with the client. If the product is suitable, it finds place in the portfolio. The main job of a financial advisor / planner is to advise the investor on how and where to invest to meet future financial goals and how to best tackle capital market impulses.

Some other advantages like:

  • Professional advice that may help improve your investment results.
  • Expert help in determining the best way to allocate your assets.
  • A trained and objective professional who can help you avoid panic selling. Remember it is NOT about ‚ÄúTiming the market‚ÄĚ, it is always about ‚ÄúTime in the market‚ÄĚ.

Many assume that having a little knowledge about financial products is enough to plan their financials, but it is like‚Äúknowing how to drive a car doesn‚Äôt mean we are a NASCAR racer‚ÄĚ or one may assume that the Internet and financial planning software can cater to all these needs, but although they are convenient tools, they cannot equal the personal attention and experience of a professional like financial advisor who can make that difference in helping you manage your financial future.

As stated by CEO of MotilalOswal РMr.Ashish Somaiyaa, Financial aspects of life is not life threatening as medical issues but just as you have a doctor, pharmacist and a drug manufacturer, Here too there is a financial advisor, financial product distributor (like insurance agent) and a financial product manufacturer (think Mutual Fund Companies). Just as you give importance to the doctor in your medical life, it is important to be conscious about your relationships with financial advisor / planner in your financial life.

Here is my post on Best Financial Advisor / Planner in Mumbai


Disclaimer: I am not your financial advisor. Also, I am not SEBI Registered Investment Adviser. I write articles to share my opinion and experiences of managing money. The information and services may contain errors, problems or other limitations so I request you to contact your Financial advisor, CA or legal advisor for professional advice before making any financial decision. All views and opinions shared here are purely individual opinions. If you have any questions or concerns regarding this post then please contact me and let me know.

Posted in Advisor, Financial Planning and tagged CA, Chartered Accountant, Taxation.