Mr. Sharan C. Patil,Inspire India Financial Solutions Pvt Ltd., Bangalore

Meet the man who has set the sail and made his mark within a short and tough span of time – the last seven years. Sharan Patil, the founder & CEO of Inspire India Financial Solutions Pvt. Ltd., is doing an impressive work in Bangalore and adjoining areas. We shared his interview in Feb. 2016 as well, where we discussed about his achievements of securing 1 Cr. SIP Book and his commitment to change the life of Indian Middle-class. He has taken the challenge to transform the lives of Indian middle-class families. In his words, “Our vision is to transform the middle class individuals to Crorepatis”.

In this interview, Sharan highlighted the importance of Financial Planning and how he is changing and bringing financial prosperity in the lives of his clients and also how his business is benefiting by applying financial planning related concepts inherently. He also shared his thoughts on the benefits of Family Needs Planning and Tracking Facilities/Tools available on Partner Desk.

Team e-Saathi sincerely thank Mr. Patil for taking out his precious time once again at a short notice and for sharing his views with the readers of e-saathi. By using financial planning as an integrated business approach, Sharan has chosen a path of financial wellbeing for his clients and helping them in achieving life dreams. We wish luck to Mr. Patil.

Q. Why do you think financial planning is important for clients?

Sharan:Most clients concentrate on income only. They don’t think about the money management part and neither does our education system cater to learning about financial well-being. Financial Planning is an integral part of money management when you make a goal based investment. Financial Planning is nothing but creating a goal and converting those goals into reality. Harvard University surveyed a group of people for studying the impact of having clear cut goals. 84% of this group had never set any goals while 13% had just thought about their goals. The rest 3% listed out their financial goals. After few years, the 13% earned double the income of the ones with no goals, while the 3% were ten times wealthier than the rest. This survey reinforces the significance of setting financial goals and that’s exactly what Financial Planning is all about.

Q. Tell us how you are using financial planning approach in your practice?

Sharan:There are many useful aspects of FP. One of the most interesting is financial freedom. If we closely look at people around us, there’s an entrepreneur hiding in each one. But most commonly due to lack of good financial back-up, people are forced to take up work soon after their graduation. Then the marriage happens and sooner or later they get buried under the loans of housing, car, etc. At this point chasing their passion becomes a distant possibility, since loan repayment and monthly expenses are to be taken care of. The next 15-20 yrs are gone in repaying loans.

Financial Planning helps us in addressing these issues. Once the person starts earning and even before contemplating any loan, a certain portion of his income is allocated towards financial freedom. Over a period of 6-7yrs, a lump sum gets accumulated. If this is good enough to generate income to meet the monthly expenses of the family, it gives the much needed respite from the pressures of compulsive working. That’s the power financial freedom money. It is from this point they can actually kick start something they have always wanted to do. Until the new venture starts giving substantial returns, the financial freedom money will handle their regular expenses. In business it is believed that higher the risk, higher is the return. Financial freedom money allows one to experiment with such risks which would otherwise not be possible.

Q. How do you make use of the financial module available on the partner desk?

Sharan:Certainly, the Partner Desk is a source of respite for us. The clients have a tendency to forget their own plans. While doing Financial Planning, we attach all such plans to Need Analysis in Partner Desk. This shows the funds allocated to each goal, the expected returns and the time left to achieve them. The investment plans can be changed as and when required. So, during Need Analysis, when people come for investments, we show them the specific funds for specific goals.

Next is the case of stoppage and premature withdrawals. People are often disturbed by the market volatility. But looking at their Need Analysis report, they recollect their goal-based investments. Secondly there is enough clarity to assess if the chosen fund is performing in an expected manner and if it’s still aligned with the client’s goal. Since all this information is readily available for the clients to see, it reassures them if their investment is going in the right direction. This has drastically reduced emotional withdrawals.

Q. Do you see any visible difference in client’s attitude to investments when linked with financial goals?

Sharan: Yes, the client’s attitude definitely changes when their investments are aligned with their financial goals. People would know why exactly they’re investing and its importance for the future. There’s always a tendency to spend today and feel that the future needs will be met. Such wishful thinking usually witness a dreadful ending because of financial stress. Such blunders can be mitigated by listing our financial goals. Once listed, it not only gives us the clarity but also makes us understand how expensive they could get at a future date due to the inflation factor. It brings in a great deal of financial discipline in one’s life, avoiding unnecessary expenses and emotional buying. Investors also learn to recognise their needs and goals, and that it is their needs that have to be addressed first.

As an example, education expenses of Rs20 lakh today, will be costing around 80 lakh after few years and can completely take the client by surprise. And if started at an early stage, it is possible to achieve a tremendous growth with small investments. So the trick is to start early since age will be on the client's side. Similarly, to build a retirement corpus, a person should start early. There’s no point thinking of it at an age of 50 or 55yrs. Investments need time to grow. Even with a modest growth, long term holdings can see huge returns at the end.

Q. How has your business benefited by using the financial planning approach?

Sharan: The other name for investment is ‘patience'. A recommended investment takes a while to actually seem to be in alignment with one's goals. It takes a lot of patience and understanding on the investors end to stay invested. It is here the Financial Planning comes into picture. During financial planning, a detailed discussion happens with the investor and we educate them the benefits of staying invested over a long term. Most of the planning, especially the long term, is associated with equity. Hence any market volatility is sure to bring in certain apprehensions. But an investor, who’s mentally prepared for such scenarios, will remain unperturbed. Also, the financial planning approach gives clarity about the approximate amount required for a goal after considering all applicable factors like inflation, lifestyle, etc. Perfectly done, financial planning is the key to reach goals in a very smart and peaceful manner. We’ve done this to most of our investors and seen them realise their goals. This approach has also helped our investors to have confidence in us and refer us to more people.

Q. Can you share any client cases wherein financial planning has helped in generating additional business?

Sharan: In every business, I think referral is a very powerful way of getting additional business and Inspire India is no exception. We have a very unique method of approaching clients. We conduct financial literacy programs and wealth checks. In this process once people become our investors, they introduce their family members, friends, relatives and colleagues and that’s how Inspire India has reached around 7,000 clients.

As a typical case, one of our clients who worked as accounts head for a corporate company has been associated with us for last 6-7yrs. We did her financial planning and she was quite happy about it. This made her refer three of the company’s promoters who made hefty lump sum investments and are our HNI clients now. This is how referrals are helping us grow our biz and generate additional ones. In financial planning, the main catch is it’s client centric approach where their goals are more important than the products themselves.

Q. What advice would you give to other Partners keen on adopting financial planning based approach to advising?

Sharan: My advice to all other financial advisors is simple. Grow the client’s money and your AUM is sure to grow. Let me elaborate. Most of the advisors are target oriented, 'this much of SIP in this much of time'. You can see how the focus is laid entirely on achieving that target and as a result the client’s financial well-being is completely sidelined. This is the most dangerous turn to any financial advisor as the outcomes can only go on the downward spiral. Instead the client’s growth approach may sound too long and a tedious process, but nevertheless a sure shot way to grow the business. Also, a genuine effort to reach out to maximum number of people in order to educate them financially and help them to become financially free pays, off. So keep conducting the financial literacy programs. Do not have any expectations! Just give a good advice and see the magic unfold. I’m not saying this after reaching an AUM of 100 Cr, but this was my approach right from day one. I never knew when I reached 10 Lakh, or 1 Cr or 10 Cr AUM. I just started out with the sole intention of educating people financially, which no academic course truly caters to. Even to this day I do this and these programs have been a huge hit.

It’s nice to see people’s lives being influenced in such a powerful way. Seeing my clients reaching 1 Cr mark or getting rid of their loans or reaching their personal financial goals through regular investments are things that give me satisfaction. Each time a client reaches an AUM of a crore, my AUM is increased by a crore! So, all I do is help them grow, and in turn I grow as a by-product. It’s a win-win to both me and my client.