In times of galloping inflation in India and around the world, savings alone may be insufficient for retirement. Moreover, in retirement and old age, clients must confront a harsh reality – the potential for prolonged illness. This sobering truth necessitates the presence of a dedicated fund for medical contingencies and a reliable Mediclaim policy.  

These financial safeguards become a lifeline during challenging times. Kavita Bothra, a two-year MDRT member from Mumbai, India, says financial advisors can offer unwavering guidance and support to ensure their client’s retirement strategies are firmly in place.  

She says, "It is crucial to recognise that a financial advisor's role extends beyond technical skills and expertise. To effectively guide clients in this journey, advisors must possess qualities that establish trust and foster a strong relationship." According to Bothra, a trusted financial advisor should empathise with those approaching retirement, understanding their concerns, goals, and preferences. This approach builds trust and establishes a solid foundation for the advisor-client relationship. 

Also, practical communication skills are vital, enabling the advisor to explain complex financial concepts clearly and clearly. Active listening and responsiveness to client's needs and concerns are equally important. Finally, transparency and honesty are essential qualities that advisors must uphold, ensuring clients are well-informed and make decisions based on accurate information. 

She explains, "One of our clients was a doctor with a year's savings, a swanky apartment, two luxury cars, and many designer items. His son was getting married, and he wanted to spend his retirement savings on the lavish wedding, assuming his son would take care of him in case he stopped working." She adds, "However, after elaborate discussions, we discovered the son plans to migrate to the UK with his wife, and the doctor may not have a thriving practice to manage. He was advised to cut his wedding budget and double his savings, as he may need to work well into his seventies." Bothra helped devise a plan that helped manage expectations and ensured he kept his savings manageable. Clear communication and listening to the client and their family members helped us tweak the plans and advise him well. 

  

Assessing retirement readiness for ageing workers  

Retirement readiness is a significant concern for most people, and financial advisors can play a vital role in helping those nearing retirement age assess their preparedness. Bothra says this could be via comprehensive retirement plans, depending on their financial situation, goals, and preferences. They can also offer guidance on investment options and strategies to maximise savings. 

She points out, "It is also important to conduct regular reviews and make tweaks. One can also assist those nearing retirement age to develop an income strategy that ensures they have a steady and reliable income in their retirement years. Pension plans, annuities through India's National Pension System, postal schemes, mutual funds and fixed income schemes will work best." 

  

Strategies for success in the space  

It is important to understand your clients' unique challenges, such as inadequate retirement savings, limited access to retirement benefits, and health-related expenses. Advisors can then tackle it with tailored solutions and support. "Always listen to client needs, goals, and concerns. It will help advisors offer tailored solutions to meet their specific needs," Bothra says.  

She applies a different strategy and approach for each case she encounters.  

For example, one of her clients were looking forward to retirement when the fear of unforeseen medical expenses cast a shadow over the Kapoors’ dreams. "I recognized their concerns and embarked on a personal journey with them. I gained insight into their aspirations, worries, and desire for financial security through open conversations and empathetic listening,” she recalls.   

Bothra then built a retirement plan that included a dedicated emergency fund for medical contingencies and an investment strategy tailored to their risk tolerance and long-term goals. She explains, “I instilled confidence and reassurance by addressing their fears head-on and emphasizing the importance of comprehensive medical coverage. Witnessing their relief and gratitude as they embraced a brighter and more secure future, I knew my role as their advisor extended beyond finances.”  

Sound professional advice helps retirees make informed choices, ensuring financial advisors have lifelong satisfied clients. The commitment of a financial advisor goes beyond expertise; it encompasses empathy, understanding, and genuine care. 

 

Staying updated  

She contends that being up-to-date on the latest trends and developments in retirement planning and insurance products is essential for a financial advisor. Therefore, one must rely on various resources, including industry publications and professional associations such as the Financial Planning Standards Board (FPSB), the Insurance Regulatory and Development Authority of India (IRDAI), and the Association of Mutual Funds in India (AMFI).  

In addition, they offer access to the latest research, resources, training opportunities that financial advisors in India can tap on to serve their clients and prepare them for retirement. 

 

Contact: MDRTeditorial@teamlewis.com