India’s most challenging competition for financial advisors is back!


Wise Advice Case Competition 2018

Who are the wisest advisors in India?

Participate in India's biggest Case Competition for financial advisors

and win the title of

Wise Advisor

Read this case study and send us your responses on how and what you will advise, and why.

A three-member independent jury will decide who the Wisest Advisors are.

Our eminent jury:

Bharat Phatak

Wealth Managers, Pune

Mukesh Dedhia

Ghalla Bhansali, Mumbai

Col Sanjeev Govila

HFI Wealth, Delhi

The case

20 years ago, when Alka fell in love with Shobhit Mehra, her IIM-A batchmate, what attracted her to him was his grounded nature, which was in sharp contrast to her dreamy disposition, her mind always in the clouds, in a wonderful world of its own. Opposites attract they say, which led to their marriage 17 years ago – a satisfying and fulfilling one for the most part. Today at age 43, both have created very different career paths for themselves in Mumbai. Shobhit joined a Big Five consulting firm and has risen to become head of its Risk Solutions Group while Alka has become an acclaimed fiction writer. Their son Rahul (13) and daughter Meera (10) study at a premier International school, not far away from the comfortable 3 bedroom house they own and live in, at Santacruz (East), a Mumbai suburb.

Recent weeks have seen some strife in the Mehra household as their opposite natures are pulling them in different directions on some important decisions. Alka has set her heart on a recently constructed apartment building in the premium Bandra (West) suburb, which has splendid 4 bedroom sea-facing apartments, and both the children cannot stop talking about their potential new “dream home”. An apartment there will cost Rs. 10 crores, while they can’t expect more than Rs. 4 crores from the sale of their existing house, leaving a gap that Shobhit thinks is just too much of an unnecessary risk on their finances. The move will mean wiping clean their accumulated portfolio which is currently worth Rs. 3 crores (all in equity and balanced funds) and then taking up a home loan of another Rs. 3 crores, which will mean servicing large EMIs at a time when expenses are mounting.

Shobhit runs over the math once again for Alka, who is getting more irritable by the minute by what she sees as a risk manager talking to her rather than a caring husband and father. His take-home pay after deductions works out to Rs. 6 lakhs per month which pays for their monthly expenses of Rs. 2 lakhs, their annual international vacation that typically costs Rs. 8 lakhs and the annual school fees that currently stand at Rs. 8 lakhs per child per annum. Until last year, Shobhit was servicing EMIs on their Santacruz apartment, which took up another Rs. 1.5 lakhs per month. He finally became debt free only recently and is uncomfortable about taking on a large home loan at this stage in his career, when uncertainties in his profession are quite high – at least in his view. His annual bonus (in the range of Rs.25-30 lakhs pre-tax in the last 2 years) is what he has been investing in recent years. Alka’s earnings as a writer have been erratic – great in some years when she produces a gem, and almost non-existent in others as royalties die down from yesteryear bestsellers and the writers block prevents her from creating another masterpiece for a while. Her earnings have hitherto been partly invested – contributing meaningfully to the current portfolio corpus of Rs. 3 crores - and partly spent on acquisitions that Shobhit would normally not consider – like the Mercedes SUV in their garage. Her income tax returns in recent years shows a wide range of professional income – from Rs. 21 lakhs to Rs. 108 lakhs per annum.

Shobhit’s view is that this is the time for them to be saving up for their children’s overseas higher education, for their marriage expenses and for their own retirement. Taking on a home loan that denies all those savings seems irresponsible to him. Alka’s view is that he is being far too pessimistic about everything and therefore denying his family the life style that she believes they deserve and can afford. He still has a good 20 years of work left in him and so does she. What is the point of only thinking about tomorrow and denying yourself happiness today? And then of course there is the issue of having no guest room in their present house which always creates issues when either of their parents come over, as one of the kids lands up sacrificing their room for that duration. Why can’t we go to a bigger house, she asks. And, its not as if the money is going down the tube – the Bandra apartment is premium property, being bought in a buyer’s market – it will only appreciate over time, she feels.

Alka dismisses Shobhit’s concerns about professional uncertainties – she says his risk management consultancy job has made him only focus on the downside, thus denying them the upsides that they seek. His CV can get him a job in any financial or other services oriented company, should he ever need to move out from consulting. Moreover, she points out to the fact that professionals peak in their income generation between 45 and 60 – which means there is immense scope for him to make a lot more money than he currently makes. On her part, she is willing to be less erratic with her writing commitments – she says if it means paying down a home loan for a house she yearns for, she will happily put in that extra effort which she didn’t see a need to until now, to augment family income and savings. Shobhit believes that hoping for a mercurial income stream to suddenly become steady and strong borders on wishful thinking, however strong the intent may be.

When family friends Ajay and Renu came over last weekend for dinner, Alka narrated the situation to them and asked them for their inputs. Ajay mentioned that while he may not have the right answers, he knows somebody who probably will. He calls you – his trusted financial advisor of many years – and asks you to set up a meeting with Alka and Shobhit and see how you can help them make a decision that could possibly work for all.

What advice will you give Shobhit and Alka and why? Please support your advice with necessary plans and numbers. You are aware that beyond numbers, there are conflicting emotions and aspirations that need to be sensitively handled.

Next steps

1. When drafting your response to this case study, please remember to address three aspects: what will you advise, why will you advise this and how will you advise them.

2. Here is the evaluation matrix that our jury will use to evaluate your responses - please go through the parameters as well as weightages before drafting your response:

3. Before drafting your response, you may wish to peruse previous years’ cases and the winning responses:
Wise Advice Case Competition 2017: Click Here
Wise Advice Case Competition 2016: Click Here

4. Please mention the following details in the covering mail to your response: Name, Firm name, ARN/RIA No, City, Email id, Mobile number.

5. All the above details must be provided in your covering email only. Your identity should not be disclosed in the pdf/doc files and other attachments you may append to your actual response to this case study. The jury would like to evaluate your responses without any name bias potentially creeping in.

6. The Wise Advice case competition is open to all individuals in the financial intermediation business - distributors, advisors, wealth managers, employees of financial planning and wealth management firms. There is no restriction on number of individuals who can participate from the same firm.

7. Responses can be sent in doc/pdf files with supporting excel sheets if you desire. You can also embed excel workings into the doc/pdf file.

8. There is no word limit - but you must understand as a wise advisor, that you need to strike a good balance between brevity and verbosity. How you present your advice is as important as what you present - please remember you are dealing with a family that needs guidance to navigate through differences of opinions to arrive at workable solutions.

9. Winners will be awarded with Wise Advisor trophies at the 9th annual Wealth Forum Platinum Circle Advisors Conference on Aug 30 and 31, 2018. Your winning advice will be shared with conference participants and will also be featured in a special e-book that will be published for the 2018 edition of the Wise Advice Case Competition.

10. Winners will have a huge feather in their cap to present to clients and prospects - having been adjudged the among the wisest advisors in India, by the advisory fraternity, in India's most challenging competition for financial advisors!

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