In India there are more financial advisers than people
“You are in your 30s and you have a risk profile of a 60-year-old? Why? WHY?” a financial adviser told me recently in a ‘I am scolding you’ tone. I’d gone there to seek some investment advice but halfway through, I felt like I’d stolen someone’s tiffin box and was now being told to put my finger on my lips and kneel in a corner. After a while, I wasn’t sure if he was investing and I’d somehow lost his money or I was the client seeking some basic information on investment options.
It appears in India there are more financial advisers than people. Which is saying a lot because we have a lot of people. ‘Think about retirement’ is sometimes the first sentence from such a person regardless of who you are and, thus, ‘I’m only 12’ is not a sufficient rebuttal.
If you are from a colonial hangover (hungover?) generation that thinks talking about money is indelicate, then the relationship with this person can become as intimate as, say, a middleaged person telling a psychiatrist about bedroom problems. Indeed, the novelist Hanif Kureishi writes, “Talking about how much money one has and how to use it, is far more delicate and confidential than talking about how much sex one has, and with whom.”
Given that analogy, you’d think financial advisers would say, “Who are you as a person? Are you an insane artist who wants to travel the world or are you miserly Scrooge-like? Are you financially incompetent or astute down to a paisa? Do you take reckless chances on a whim of an idea (Google investor) or do you save your whole life for a dream something (beach house, iPhone 6 Plus)? “Do you cry at the sight of incorrect social stuff (neglected old people, dying tigers) and give your cash to that cause? Or would you rather trade philanthropy for cold, calculating exponential greed (hedge fund guy)? Do you value a Bali vacation over owning your own home? Or would you rather never go anywhere till you bought a BHK even if it overlooked a drain? Tell me, WHO are you?
And spend as who you are. And be happy. That question is never asked. Instead, they presume who you are and want to make you them. They assume India always saves, thinking, ‘What if tomorrow I had no money?’ So, all their advice is: put it away in some bond, debt, equity, put it away in ayojna or a provident fund, locked up something, think crisis, think tomorrow, think what if I am destitute, like the guy that begs at the traffic signal —the ultimate fear.
So, in the present, never have access to touch any money that gives you pleasure, treat it like irresistible dessert. Imprison yourself to a future, live frugally like you’ve lost a large bet. But in 30 years, you have compounded savings. But in 30 years, you also have asthma and arthritis, and life was what happened when you made other plans. Imagine Napoleon saying, “You know what, I won’t be the Emperor of France and risk everything today. I’ll put away one baby Franc coin in a piggy bank and in 30 years, I’ll….” The economist John Maynard Keynes had said about investing for the long run, “In the long run, we are all dead.”
What if you are from a kind of India that has the confidence to say: skills are my asset, not the money in my bank. So, if I spend it all, I’ll make it again. When you are young, they assume you have the appetite for more financial risk? Why? There are as many old people that want to bungee-jump as there are 20-somethings who want to knit and save things in FDs. Fundamentally, they assume. Perhaps the best advice for giving advice is not assuming a way of life but facilitating one by listening to the one telling you who they are. And how they’d like to be.
Ultimately, money is never about money. It is about human nature. Till then, listening to an Indian financial adviser is like speaking to a sex advice columnist whose recommendation for a healthy sex life is to have it on your behalf.
by Anuvab Pal, The Economic Times