20-hour Customized Process. Not the 5-hour Robo++ Process

  • The 5-hour Robo++ Process is the prevalent model in India
    • The 5-hour Robo++ Process provides almost the same plan to all clients, just like a Robo-Adviser does
    • Additionally the Robo++ Process provides the client with a couple of hours of interaction with the RIA to clarify some aspects which are unclear 
    • The Robo++ Process typically requires the RIA to put in 5 hours of effort during the first year of engagement
  • I follow a 20-hour Customized Process with each client
    • The Customized Process goes into sufficient detail with each client:
      • To identify at least one important issue that the client had not realized (e.g. that the client was taking too much investment risk) or address at least one critical question that the client has in mind (e.g. should the client retire now or later)
      • To explain the recommendation and reasoning in detail so that the client understands it and is hopefully convinced by it
      • To educate the client about critical aspects of financial planning and investing e.g. how do you calculate how much you have to save for retirement; asset allocation between equity / real estate vs. safe assets
    • I co-created the Customized Process in India along with one other Fee-Only (Advice-Only) RIA 
      • The 15-20 hour Customized Process is similar to the approach of best Fee-Only (Advice-Only) RIAs in the US, where financial planning is far more evolved
    • The Customized Process in India typically requires the RIA to put in 15-20 hours of effort (including discussions and back-end work) during the first year of the engagement
      • The second half of this article provides an illustration of one part of the Customized Process in one particular situation
      • And this article in MoneyControl provides a bigger-picture illustration of the Customized Process
      • My process involves a minimum of 7 hours of discussion (7 calls of 1 hour each, spread over 1-4 months). Hence if it is not possible for you to dedicate that much of time, then this approach is not a good fit for you

Risk-averse Approach

Decisions

  • I advise clients and occasionally, where critical, I try and convince a client
  • Clients take the final decision about whether or not to partially / completely accept each recommendation

Implementation

  • Clients are responsible for implementing the Financial Plan. Typically, this is done online
  • I try to guide the client through the implementation of the Financial Plan, but I do not have any direct or indirect control over the client's investments

Logistics of the Process

  • With existing clients:
    • The primary mode of discussion is over pre-scheduled audio calls else then, a one-time video call (typically, Monday to Saturday, 9am to 7pm)
    • The secondary mode of discussion is over email
    • I do not do face-to-face meetings with anyone 
  • With potential clients:
    • The primary mode of discussion is over a pre-scheduled audio call (typically, Monday to Saturday, 9am to 7pm)
    • I do not do face-to-face meetings nor video calls with potential clients

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