Managing finance has become an extremely complex process and it is more than purchasing an insurance policy or saving in a fixed deposit particularly in this financial world which is evolving at a very fast pace. With multiple investment options available today like stocks and bonds, it becomes a problem when it comes to deciding where to invest and how to invest. Tax planning, management of various risks, planning for retirement - these are still other facets which tend to pose a problem and people generally struggle to come up with some proper solutions. A SEBI registered financial advisor can be your trusted guide and help you to manage your finances in an efficient manner. 

Why does the professional advice of a SEBI Financial Advisor matters? 

The fiduciary duty 

A SEBI financial advisor has a fiduciary responsibility and the advisor is legally bound to provide advice that is in your best interest. Financial advice that is aligned in a perfect manner with your financial goals and is also unbiased are provided by the registered advisors. Much unlike the other agents who tend to promote financial products for a commission, a SEBI registered advisor works in a manner that actually benefits the client. 

SEBI - the regulatory authority 

SEBI or Securities and Exchange Board of India is the regulatory authority that performs a number of functions to meet its objectives associated with investor protection, development of the securities market and also proper regulation of the market. 

Finance management accomplished in the best way 

An entity or even an individual who wishes to offer financial advice must be registered with SEBI as a SEBI registered financial advisor. This registration is important because it assures the investor that the advisor meets the required educational as well as professional qualifications; it is ensured that the professionals providing the financial services follow a strict and particular code of conduct; the registered financial advisor provides services that are only in favour of the client; it is ensured that there is transparency in the fee structure that the professional advisors abide by and there are no hidden commissions associated with such a structure. 

Thus, it is quite clear why it is necessary to partner with a SEBI registered advisor when it comes to dealing with the management of your finances. 

Understanding the goals of life

he SEBI financial advisor initiates the process of financial management by understanding the goals that you have and this could involve purchasing a house, funding the education of the children, planning for the retirement period, building a safety net particularly to deal with emergencies or growing wealth to achieve financial independence. 

A plan designed in accordance with your aims and objectives

The registered advisor instead of providing common investment advice and recommending generic plans, designs a financial plan that is in accordance with your unique financial goals and various other factors like risk tolerance and also time horizon are taken into account. For instance, if you are planning to buy a house, then the registered advisor could recommend recurring deposits or debt funds that are associated with low risks. If you are in the process of saving for your retirement, then the advisor could suggest equity investments that could bring you higher returns in the long run. 

The common mistake that should be avoided  

A very common mistake that individuals make revolves around investing too much in a particular asset class which could be for instance, real estate or even gold while the other options are neglected. The result of such an investment could be exposing investors to unnecessary risks or even it could pose a hindrance when it comes to dealing with the growth potential. 

The perfect approach 

The SEBI registered financial advisor helps you to build a portfolio that is diversified and which strikes the perfect balance between the following: Equity (stocks and equity mutual funds) that ensures long-term growth; bonds, fixed deposits and debt mutual funds that bring in stability and income; gold and other commodities as a hedge against inflation. Such an approach ensures that your portfolio is not just diversified but also is in perfect alignment with your financial goals and also your risk appetite. 

Managing the inseparable part of investment - risk management

Risk happens to be an unavoidable part that cannot be separated from investment. However, it can be managed in a smart way with the help of the  SEBI financial advisor. Such an advisor makes the finest use of proven techniques and this could involve: Asset allocation which involves distributing your investments across the different asset classes like equity, debt and so on; periodic rebalancing, which refers to the process of adjusting the portfolio to ensure that the desired risk level is maintained; insurance planning, which involves ensuring that you have adequate life, health as well as general insurance coverage to protect against unforeseen events. 

Tax management 

Taxes need to be managed in a proper manner else it could have an adverse impact on your returns. The registered advisor helps you with tax management and he ensures that only tax-efficient investments are chosen. Further, the SEBI registered advisor helps to structure withdrawals to minimise tax liability. This kind of a strategic approach ensures that you not just grow your wealth but also are able to retain the most of it. 

Retirement planning

Retirement, as a matter of fact, is an extremely crucial financial milestone and when you are planning for it you definitely need quite a bit of foresight. The SEBI registered financial advisor helps to with such a planning by assisting you in answering questions like how much funds would be needed to live in a comfortable way, what investment strategies should be implemented in order to achieve such a goal, what steps should be taken to ensure that sufficient funds last during the course of the period of retirement. Future expenses and life expectancy are projected, inflation is estimated and by doing this the registered financial advisor creates a roadmap that ensures that you do not outlive your savings. 

A process that keeps going on

Financial planning is not just a one-time activity but it indeed is a continuous process. The registered advisor does not create a plan and leaves you with it to manage the rest. The SEBI registered advisor monitors the portfolio on a regular basis, he also keeps a track of the changes in the market and the various economic developments, he makes adjustments when the circumstances of your life changes and last but not the least, he rebalances the investments periodically to remain on the right track. 

Final Note

In a world full of options where making an effective and proper decision is quite a bit of a challenging task, the SEBI registered advisor acts as a partner who can be trusted and helps you to simplify the entire process of financial planning. Right from tax planning to managing risks and also creating financial plans that are goal-based, the registered advisor guides you along the right path and prepares you for the future.