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Fees
- My current fees are:
- For new clients, Rs 1,25,000 for 5 hours of effort
- For current / former clients that chooses to renew the engagement, Rs 50,000 for 2 hours of effort
- Note: I continue to do Introductory calls. But due to a bandwidth constraint at my end etc, the formal engagement can start only on 1st April 2025
- The hours of effort are for a project which is to be completed within a period of a 6 months
- My engagement earlier used to be for 12 months and I would have ideally liked the engagement to be for 12 months. But SEBI regulatory changes forced me to limit it to 6 months
- There is absolutely no requirement to renew the engagement annually and most clients do not renew the engagement annually
- But to help you visualize the fees, a typical / average client could visualize entering into a new client engagement in Month number 1 which will be from Month 1 to Month 6. And then there being no active engagement from Month 7 to Month 12. And then entering into a renewal engagement in Month number 13 which will be from Month 13 to Month 18. And then there being no active engagement from Month 19 to Month 24. And so on
- The fees are effectively Rs 25,000 per hour of effort
- With new clients, this usually means a total of 3 audio calls, each of 45 minutes
- With renewal clients, the scope depends on whether the client is renewing the engagement immediately after the previous engagement or after a gap of many years (in which case there is more back-end work). In both cases, this usually means at least 1 audio call of 60 minutes
- The fees are inclusive of any taxes
- Hours of effort includes hours of discussion and back-end work (Back-end work includes research that is specific to one / a few clients but it does not include research effort that is common across all / most clients)
- I provide clients with an updated Timesheet during the engagement
- Since there are people who try to impersonate RIAs, please do not pay any fees till BOTH (a) you send a detailed introductory email to [email protected] AND (b) I reply from the email address [email protected] to the exact same detailed introductory email that you sent, we do a 30 minute introductory call, we sign an agreement and then I request for payment of fees
- FYI: I have never contacted a single potential client i.e. every single potential client has contacted me to become a client...
- I have never recommended even one specific equity share or trade to any client...
- I see every single active mutual fund, PMS, long-short AIF etc as a waste of money and fees
Details of Fees
- Fees are based on 5 hours of effort. This is a radically different from the Robo++ Process
- The fees are based on the assumption of 5 hours of effort for new clients and 2 hours of effort for renewal clients
- This Customized Process is radically different from the 2-hours-of-effort with new clients Robo++ Process that is prevalent in India (details are in the Approach page)
- The engagement with new clients is for 5 hours because of a side effect of SEBI regulations
- SEBI regulations (more so, the changes in the regulations in 2020) are primarily focused on protecting Lower-Middle-Class clients and that has unintended side effects for Upper-Middle-Class clients
- SEBI's regulations assume that Lower-Middle-Class clients should be served by a Fixed-Fee engagement while Upper-Middle-Class clients should be served by a 'Percentage of Assets Under Advice fee' engagement
- However RIAs such as myself are opposed to the 'Percentage of Assets Under Advice fee' and instead charge a Fixed-Fee to Upper-Middle-Class clients
- Hence, SEBI regulations do not allow me to offer an engagement with an even higher number of hours of effort to new Upper-Middle-Class clients
- Note: This earlier used to be an engagement with even more hours of engagement. To make the engagement fit within the number of hours of effort that is allowed by regulations, I have recorded some generic aspects of the engagement as audio presentations. Clients watch those audio presentations before the call so that the client and I can focus on client specific aspects during the calls
- Subsequently, Passive Index Funds reduce the need to renew the engagement
- I recommend a simple portfolio of Passive Index Funds etc that the client can usually manage by themselves
- Clients that do not renew the engagement in the 2nd year may renew in the 3rd or 4th year when something changes in their life or if there has been a significant change in taxation of mutual funds etc
- Fees are the same for Resident Indians as well as NRIs
- I do not offer any other engagement with a reduced scope and lower fees
- In the context of NRIs, I primarily engage with NRIs who are likely to eventually retire in India
- The number of hours of effort mentioned above will not be sufficient in a few cases. So the scope will have to be worked out in such a cases:
- For an engagement with a joint-family
- For a client who does not know how to execute investments in direct plans of mutual funds (Such clients may be better off engaging with the Hourly-Fee RIAs who are recommended further below)
- Fees are payable in advance
- The fees are payable in advance at the start of the engagement
- To clarify, the introductory audio call is free of cost. But I do not provide any investment advice during this introductory audio call
- Renewal fees will increase over time
- The renewal fee will increase over the years for all clients who choose to renew the engagement
- I was the first Hourly-Fee Financial Planner in India
Focus on clients with a net worth of Rs 1 to 100 cr
- Net worth in this specific context refers to a couple's total value of all assets including real estate (even if you live in it) and any very likely inheritance; minus total liabilities
- To clarify, it does not matter even if the client has zero Rupees free to invest over the next several years since that does not make any difference to me (e.g. if the client would like to focus on pre-paying a home loan)
- New clients may get value-for-money from this engagement, if... (Note: This does not apply to existing / former clients)
- Your age is <= 29 and your net worth is >= Rs 1 cr (Note: At a net worth of Rs 1 - 2 cr, it may make sense to engage with me only if your combined pre-tax salary is > Rs 0.5 cr p.a.)
- Your age is 30-34 and your net worth is >= Rs 2 cr
- Your age is 35-39 and your net worth is >= Rs 3 cr
- Your age is 40-44 and your net worth is >= Rs 5 cr
- Your age is 45-49 and your net worth is >= Rs 7 cr
- Your age is 50-54 and your net worth is >= Rs 9 cr
- Your age is 55-59 and your net worth is >= Rs 11 cr
- Your age is >= 60 and your net worth is >= Rs 12 cr (i.e. approximately USD 1.5 million)
- Note 1: In case you are entitled to a pension from your employer (i.e. not NPS) or you are a Doctor / Dentist who is less than 45 years old, then read the above numbers as half of what is mentioned e.g. "if your age is 40-44 and your net worth is >= Rs 2.5 cr"
- Note 2: If you do not know how to execute investments in Direct Plans of Mutual funds, then read the above numbers as 50% more than what is mentioned e.g. "if your age is 40-44 and your net worth is >= Rs 7.5 cr"
- Note 3: If your net worth is less than the amounts mentioned above, then the engagement will not be able to provide you value-for-money. Hence you would be better off contacting:
- (a) Hourly-Fee RIA Swapnil Kendhe who at least within Equity mutual funds, recommends only Index Funds; and who follows the Customized Process (5+ hours of effort per new client); and whose fees are effectively Rs 6,000 per hour (which is exceptional value for money), or
- (b) Hourly-Fee RIA S R Srinivasan who at least within Equity mutual funds, prefers to recommend only Index Funds and who follows the Customized Process (5+ hours of effort per new client)
- Context: I do not earn anything from this recommendation of other RIAs
