In this article, we will discuss about of some of additional roles which financial advisors should think to play with their clients and other stackholders. Financial advisors often wear many different hats while practicing. The roles can be broadly described as – Sales & Operation, Marketing, Administration or Advisory in nature. Most of the roles are very basic or primary to the nature of our business. However, to excelling as a financial advisor to a client means a lot more than handling queries and submitting application forms. Financial advisors will need to act and be financial guides or mentors to their clients. Let's Look into this in detail....
Primary Role:
Before we start talking of the 'other' roles, here is a brief listing of the primary role /responsibilities which advisors are expected to play. These roles, depending on your business practice, should never be ignored or compromised for any reason.
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Identifying risk appetite
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Managing asset allocation
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Ensuring protection
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Helping in tax planning
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Handling grievances
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Doing Financial Planning
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Distribution of financial products
Other Roles:
As earlier said, financial advisors also need to act as financial guides /mentors to their clients. It is something which is very subjective and wide in scope. Here is a listing of the roles/responsibilities which trusted and skilled financial advisors can play with their clients.
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Financial literacy : Financial advisors are expected to help clients become savvy investors with adequate financial literacy. One is expected to help client become aware of areas like – asset classes, investment products, insurance coverage types, tax saving avenues, comparison between different financial products and so on. One is also expected to help clients become careful and smart enough to not fall prey to the many online scams, phishing accounts, identify theft, etc. in an era where e-commerce has gained prominence. One is also expected to help clients become aware of ponzi, quick-money, multi-level marketing schemes which make huge promises.
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Regular communication : This is something that forms of the essence of a relationship. A powerful, relevant, informative, interesting, regular and brief communication strategy has to be adopted by advisors. The communication strategy can cover different modes /channels where appropriate messages/contents will be communication for purpose of information/updates or promotion.
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Putting financial records, accounts & documents in place : A financial advisor must follow this important bit of role wherein he helps consolidation of all information, records and documents in place for the clients. One can effectively use online Client Desk for consolidation of financial records. Beyond this, one can also guide clients in managing/ updating accounts w.r.t. - nomination, joint holding, contact information, etc. Consolidation of documents can be done as per convenience/scope of engagement with the clients.
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Controlling emotions : The real role of the financial advisor is actually controlling emotions of the clients. It is about making him act rationally and logically, even in face of extreme scenarios. Controlling emotions will require skill, confidence, facts & proper communication from the advisors.
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Encouraging Savings : All advisors carry this role of encouraging savings behaviour in their clients. And it is time that we advisors adopt a proper strategy and pitch in order to do so instead of trying to firing on all cylinders.
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Helping out of debt : As a financial guide, one is expected to help clients avoid debt trap and to payoff debts as soon as feasible. Given the credit savvy generation with high income, this becomes an important role of advisors. One should again prepare and follow a proper method of comparing and evaluating debt repayment strategy for clients.
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Handling issues in financial products : It is obvious that advisors will be handling queries/issues in financial transacted through them. But how about helping the client & family for such complaints/issues which are through other financial advisors? This is a good way of winning the trust of clients and many advisors are very happy to play this role.
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Ongoing financial guidance : As a financial guide and mentor, you should be the go-to person at the top of the mind for the client for any matter where an expert opinion is required on any financial matter. On an ongoing basis there are many things where the financial advisors can be of help, provided that some prior study and research is done by the clients. With proper inputs, financial advisors can help clients to - decide between options with varying financial implications (ROIs), do cash-management, do repayment of loans, make buy /rent decisions for properties, structure salary packages, decide on choice of home loans and so on.
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Help in tax fillings : Beyond tax advice, clients would also appreciate if we can help them in filing tax returns by informing of due dates, assisting with online filling, etc. Some advisors often also help clients register and enter records on many online sites offering tax return preparation /submission services.
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Writing of Wills : An important element in overall wealth management is wealth transfer. Financial advisors should also help clients in this aspect, subject to the nature of relationship and engagement enjoyed with the client. An advisor can help in creating awareness, updating records in the accounts with financial institutions, preparation of Will, playing the role of an executor to the Will, and so on.
Conclusion:
Carrying out the 'other' role by the financial advisors helps one to build trust, get closely involved with the clients and their family and ultimately become financial guides & mentors to the families. This should be the aim for any financial advisor. However, it is something that will take time, will need effort and hard-work and will also need better time management and organising skills. To begin with, we should first decide to what level we wish to extend the scope of our services /relationship and how do we plan to make sure the expected results are delivered to the clients? It is something that needs good thought and planning on your part. The possible benefits though are attractive enough for those who can answer the questions in the most cost-effective, productive and planned way.
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