Questions you should ask prospects

By Ravi Samalad |  23-06-20 | 
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About the Author
Ravi Samalad is Assistant Manager - Editoral for

Asking the right questions helps advisers get insights about the client’s aspirations and goals. Thus, before you onboard a client, it is essential to probe and understand why the prospect wants to invest with you. This helps advisers understand a prospect’s expectations and communicate what they can deliver and what they can’t. Getting to know your client in advance helps in fostering a long-term relationship.

Here are a few questions every adviser should ask a prospect:

When do you need the money?

Samir Vora of Ocean Finvest says that prospects often overlook the aspect of liquidity. In the race to earn higher returns, they end up investing in products that may not suit their goals. “After getting to know their goals, we try to understand the tenure of their investment. After this, we do a detailed analysis of their risk appetite. Further, recent episodes in some debt fund categories have brought forth the issue of liquidity. People invest without considering liquidity aspect. We also try to understand how they arrived at their current asset allocation and if they are open to making changes to the portfolio. Also, we try to educate prospects about the taxation aspect of investments,” says Samir.

How has been your past investment experience?

Some people might have invested in products which were not suitable for them and may have had a bad experience. For instance, a prospect may have invested in a stock and burnt his/her finger. Such clients may have grown averse to investing in stock markets. So understanding a client’s past investment experience helps advisers handhold and educate clients better.

What expectations do you have from me?

Many a time, clients might have unrealistic return expectations and they would hunt for another adviser who could deliver higher returns. Thus, advisers would do well to understand whether the prospect already has an existing adviser and why he/she is leaving their current adviser.

What is your profession?

It is pertinent to understand the client’s education, their profession/business they operate in. Even people working in the financial services industry may not be so well versed with the complexities of investments or understand jargon. Since advisers are so involved in finance, money and investing, they would assume others know what they are talking about. Knowing a client’s area of interest will help you tailor your communication by sharing examples they would relate to. Also, the financial plan would be very different for an entrepreneur, artist and a salaried individual. So knowing a client's background helps.

Where do you see yourself 3/5/10 years from now?

People may tend to think that an adviser can only help them channelize their savings into products that will earn good returns. Not many people would know that an adviser can help people start their dream venture, go through a divorce, do estate planning, help buy a dream home, fund higher education abroad and much more. Asking this question will help advisers understand clients’ aspirations well and offer bespoke solutions.

What are you passionate about?

This question is beyond investment and money. Suppose a client says he/she is very passionate about the cause of environment protection and is actively involved with an NGO that works towards raising awareness about climate change.  You could help such clients apprise that they have investment options like environmental, social and governance (ESG) funds that work on these principles. It could mean a world to the client.

Registered Investment Adviser Basavaraj Tonagatti asks these questions to prospects:

1. What are the reasons you felt a planner is required in your life?

2. What difficulties are you facing while managing your current finances?

3. Do you understand the difference between a typical adviser, fee-based planner or fee-only planner?

4. Which asset class scares you the most where you felt a planner is necessary for you?

5. Do you understand the basics of financial planning like goal-based investing or asset allocation?

To sum up, advisers may come across different types of prospects – some may be forthcoming to share information while others may need probing. So advisers would do well to ask as many questions as they want that are relevant for them.

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