Vital when getting the direction or decision right is critical. This is when good advisors can really make a difference. Such advisors will need to be knowledgeable, have expertise in the domain and should have the best interests of those who they are advising. They need to have high levels of ethics, integrity and be fully trust-worthy.

What many find are advisors who are offering their two-cents that are worth far less! The only problem is that people think that such advisors are worth their weight in Gold. That is the irony. Influencers present content with click-bait headlines that lures people by the lakhs.

Then there are product pushers masquerading as advisors, push their products and play the yes man role to get custom. Unfortunately, investors love such advisors who suggest fresh products, are flexible and accommodate the investor's penchant for variety and return fixation. Many of them are big, recognisable names!

Financial Advisors and what they should do - True advisors need to engage with their clients and work purely in their best interests. They need to be Fiduciaries. For this, they need to stay away from conflicts of interest, be independent, unbiased and offer advice after fully understanding their client's position. Finding a fiduciary means you have found a confidante, who ensures that money is managed well, goals and expenses are met, wealth creation ensues and life itself is sorted

This is the difficult part today. You find advisors in the form of doctors, lawyers, architects, etc. in their respective fields. Finding a client centric fiduciary advisor is a mirage today - for there are just about 300 active in India, who are around to offer real advice! If you are one of them, you are so much ahead in the game.

Money management - A Fiduciary advisor helps in efficient money management. This is done through appropriate investments to take care of goals, liquidity, contingency and wealth creation in an efficient manner. Investments are made based on Asset allocation principles, according to the personal situation in life, risk profile and other factors.

Also, a good advisor always looks at the costs the clients are incurring. Firstly, the investments are suggested in commission-free products, lowering costs.

Secondly, the move is towards simplicity in the products suggested, resulting in better alignment and fit. Also, simple products tend to be lower in costs compared to complex products that are costly and mostly do no better than the simple ones.

Thirdly, only a Fiduciary will suggest passive products, which distributor, wealth manager etc. will not suggest. These products are very low in terms of cost and offer better returns.

Avoiding Mistakes - In the absence of a good advisor, investors tend to be led astray and make mistakes and even blunders, which set them back by years and in money terms, inhibits their portfolio growth by a huge factor. An example of this would be inappropriate insurance which offers low returns and is misaligned to their situation. Other examples are investing in land and properties, speculative assets, doing day trading etc.

We have seen that some of these indicretions can be disastrous and have a huge adverse impact on their portfolio performance and the usefulness of these products in their life.

Financial advice when it is needed - As we go along in life, there are several points where Financial counsel is necessary. Most people do not have an advisor and ask their friends, read up articles and blogs and ask their expert friends for advice. This kind of advice is like one blind person leading another, resulting in a mess-up in the portfolio, goal achievement and life.

A good financial advisor who knows the real position of the client will be able to offer tailored advice that is in their best interests, in every respect. Having a financial advisor to consult at every point is very important and saves one from the blushes and helps one take the right decisions.

Returns of the portfolio - One should not go to a financial advisor to get better returns. Rather the Financial Advisor ensures that there is a good plan to follow, have a guide along the way, goals are met, wealth gets created, right decisions are taken along the way etc.

Hence, the value of the advisor cannot be reduced to just investment returns.

And yet, even there a good advisor would score. See this table -