What would you do?
There are many reasons when you may say no.
- No, I am a vegetarian.
- No, I am not hungry. I just came for a cup of coffee.
- No, I just had biryani last evening. I would like to have some South Indian dish.
- No, I am on diet. I want salad and fruit juice.
- No, its too early to have dinner. Get me some snacks for now.
As a matter of fact, this situation is purely hypothetical. No restaurant would do such a thing. Rather, it would give you the menu card and let you make your choice... whether you want a veg dish or a non-veg one; whether you want a 3-course meal or just some snacks; whether you want cold drinks or hot beverages to go with it.
But when it comes to investing, your agent, banker, broker, advisor or whomsoever you approach, would do precisely this...
... Sir, this share is going to double in next 3 months.
... Sir, this deposit is giving excellent returns.
... Sir, this is the best insurance plan.
... Sir, a great mutual fund scheme has been launched.
... Sir, invest in gold coins.
... Etc. Etc.
Now, what would you do? More often than not, you would go for it. And...more often than not...you would end-up crying later.
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| Beware, your banker may be acting in his own interest... not yours. |
The agent, the banker, the broker, the advisor or whomsoever you approach is not at all concerned or interested in knowing
- whether the investment is good for you or not,
- whether its too risky for you or not,
- whether the investment is too long term (or too short term) for you or not,
- whether you already have invested sufficiently in such a product
- whether the investment is liquid enough when you require your money.
All he is bothered whether he can meet his target and get his commissions.
By the way, I am sorry to add that nor do you bother to check these points before signing on the dotted line.
The right approach to investing is to make your choices as if you are sitting in a restaurant and order as per your needs and desires.
And the right approach to selling financial products is to first ascertain the customers' requirements and accordingly suggest him the most appropriate options.
