Hiring a financial advisor? Your investing style must be the deciding factor

© Venkatasubramanian K
Hiring a financial advisor? Your investing style must be the deciding factor

Imagine this: you know three persons with similar profiles – all around 40, in the prime of life, having promising careers, with loving families (spouse, couple of kids).

They also lead similar lifestyles – sedentary jobs, some amount of travel, and lots of outside food. Let us call them Dhruva, Shakti and Harsha.


Dhruva recently entered the 40s and, being reasonably health-conscious, has been planning a health check-up. Keen to ensure that he keeps life-style diseases at bay, Dhruva wishes to be prepared. He therefore asks around, goes to a reliable hospital recommended by a couple of close friends, and gets an appointment for the next week for a full-body executive-health check-up.

The empaneled doctor there looks through the reports closely, and then proceeds to say that Dhruva has come in good time. There are some early warning signals that need correction. A few life-style changes are recommended, and Dhruva feels confident about a healthy future, as long as regular annual check-ups are done, and changes monitored. At the same time, Dhruva knows that some discipline is required in order to ensure that the next 40 years are healthy and happy.


Shakti, on the other hand, has been a bit more involved in managing personal health. There were some hereditary warning signals that needed to be watched, pretty early in life. Nevertheless, one day, Shakti wakes up feeling dizzy and disoriented, and the accompanying symptoms lead to the self-diagnosis that this could be a severe case of vertigo, something that Shakti’s mother also had. Through colleagues, the name of a good ENT surgeon, who also specialized in neurological disorders is immediately found.

Post some tests, the doctor puts Shakti on a course of medicines, and reassures that while these bouts may come again, they are not something to worry about too much as long as some precautionary measures are built into the lifestyle. Shakti is reassured and goes back to living life normally, confident that this is something that can be handled in the future.


Harsha is very health-conscious and is also someone who and runs regularly. He is very conscious of maintaining a reasonably stringent diet and has over the years built a good working knowledge of nutrition and fitness science.

Over the last many weeks, Harsha has been getting severe headaches, which didn’t respond immediately to OTC medicines. Harsha doesn’t unduly worry about it, but instead goes about trying to identify a change in habits that could be the probable cause. On some diligent tracking, a new food supplement was zeroed as the reason.

Some quick online research helps uncover that this new food supplement had an ingredient that caused some of the same symptoms. Harsha immediately stops further intake and hasn’t experienced the headaches since.

Am sure most of you would relate to these imaginary people. But what if we take this thought experiment further and give it an interesting twist?

Managing money

While we have seen many customers who are similar to Dhruva, Shakti or Harsha with regards to how they manage their personal finances, they themselves are not as clear and hence make the wrong decision about what kind of personal financial assistance they need.

If you are like Dhruva, then you should seek help from a financial planner who can assess your current personal financial health, give clarity about your family’s future financial needs, introduce some corrective steps in terms of money habits to achieve financial independence.

But if you are like Shakti, then you probably have a good handle on your finances and understand what your needs are and require a wealth manager who can help grow your wealth and meet your specific time-horizon requirements. Remember, financial planners manage your financial health, and hence will give customized investment options that are suited to your needs and risk profile. On the other hand, wealth managers usually handle a pool of funds and don’t customize their process to their customers’ risk profiles, and you yourself are responsible for your overall financial health.

Lastly, if you think you are like Harsha, then focus on building and honing your personal finance and investing knowledge through various resources and become what is popularly called a DIY (do-it-yourself) investor. Remember though that the biggest source of return in the long term is not just your investing acumen, but also your behavioral edge.

So, what type of investor are you and how actually do you manage your personal finances? It is important to have the right fit between your type and the kind of professional help you take. If you are like Dhruva and are managing your money like Shakti or Harsha, you need to quickly get a “comprehensive personal financial health checkup”. On the other hand, if you are like Shakti or Harsha, and if you have a planner, make sure that you are setting the right expectations with him or her, so that there is mutual clarity and alignment towards objectives.

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