A client rang me in June about a property deal. Should he take the loan or break some investments to pay more upfront. He'd been with us for years, he trusts me, and it was a reasonable thing to ask a person who knows his finances. I still told him I wasn't the right person for half of that question, and I could hear that it wasn't the answer he wanted.
That happens often enough that it's worth writing down properly. Here's what I can't answer, why, and where each one actually belongs.
Anything about your tax liability
This is the most common one by a distance, and the boundary isn't as obvious as it sounds.
I can tell you how a mutual fund is treated in structure. Equity and debt are treated differently, holding period matters, a switch is a sale even though no money reached you. That's how the product works and it's my job to know it.
What I can't tell you is what you'll owe. That depends on your total income, your other gains and losses, which regime you're in, and things I don't see. Somebody who answers that from across a desk without your full picture is guessing, and a wrong guess in this area is expensive.
So: a tax adviser or a chartered accountant. Our page on mutual fund taxation covers the structure and deliberately quotes no rates, because those change and this site would go stale.
Which shares to buy
Sometimes it's asked directly. More often it arrives as "what do you think about this company", which is the same question wearing a hat.
We're mutual fund distributors. We're not brokers and we're not registered to advise on shares. I don't give views on individual companies, not because I'm being careful about wording, but because I'm not qualified to and there's no version of that conversation that's fair to you.
If you want to hold shares, that's a legitimate thing to do, and our page on mutual funds versus stocks sets out honestly what you're taking on. The decision belongs with somebody registered for it, or with you.
Anything to do with insurance
We don't sell it, arrange it, or advise on it. Not a strategic choice about focus. We're simply not registered in that line and I'm not going to pretend otherwise because a question came up in a meeting.
I'll say one thing that isn't advice: protection and investment are different jobs, and a household should know which of its arrangements is doing which. Beyond that, somebody licensed for it.
Whether to prepay your loan
This is the one I find hardest, because it's genuinely half mine.
I can talk about the investment side. What the money is currently doing, what it's for, what breaking it would cost in exit load and tax. That's my half and I'll go through it in detail.
The other half is your loan terms, your cash flow, and how you feel about owing money, which is not a small factor and shouldn't be treated as one. We've written what we can on stopping a SIP to prepay a loan, and even there the honest conclusion is that the arithmetic doesn't settle it.
What I won't do is pretend the investment half is the whole question, because that's how a distributor ends up steering somebody towards keeping investments running.
Where the property market is going
No idea. Neither does anybody who tells you confidently, in this city or any other.
I'll happily discuss why the comparison between property and a folio is usually framed badly, which our page on mutual funds versus real estate goes into. That's about the structure of the two things, not a forecast.
What the market will do
The most frequently asked question in this business and the one nobody can answer.
People ask it in different clothes. Should I wait for a correction. Is this a good time. Should I stop for a few months and come back in. All of them are the same question, and my answer is the same in each case, which is that I don't know and I don't act as if I do.
What I can tell you is what a horizon implies and what you did last time something fell, which predicts your outcome better than any view about the market would. Our post on markets at an all-time high is that conversation in longer form.
How much I'll have at the end
This one I could answer. I choose not to, and it's the refusal people find strangest.
Every calculator on the internet will hand you a figure for what a monthly amount becomes over twenty years. It's arithmetic and it takes a second. What makes it hollow is that the answer is entirely decided by a rate somebody typed in, and nobody knows that rate. Change it slightly and the figure changes enormously.
So a projection isn't a forecast. It's an assumption wearing a rupee sign, and once a household has seen a number they start planning around it as though it were promised to them.
You'll find calculators on this site and they'll do the arithmetic. What you won't find anywhere in what we write is a number telling you what an investment will be worth, and that's deliberate rather than an oversight. What I'll discuss instead is the amount, the horizon and whether the instalment can rise with your income, which are the parts you actually control.
Decisions about somebody else's money
This comes up more than you'd think, usually with the best of intentions.
A son wants to move his father's holdings. A brother wants to set something up for a sibling. The person asking often has full access to the accounts and complete goodwill, and I'll still say the same thing: I need the person whose money it is.
Partly that's how the process works. Requests need the holder, and our page on how a folio is held explains who can transact on what.
But the bigger reason is that I've seen where the other version leads, and it isn't usually fraud. It's a parent who doesn't know what happened to their own money, and a family argument three years later that nobody wanted. I'd rather be the person who insisted on a phone call.
Why I don't just answer anyway
Worth being direct about this, because saying "not my area" costs me something every time.
The immediate cost is that it's unsatisfying. Somebody came with a question and left with a referral. Some of those people go to whoever gives them a confident answer instead, and I know that happens.
But the alternative is worse in a way that's slower and harder to see. A distributor who answers tax questions, comments on shares and has views on property is building a relationship where you can't tell which of my statements are inside my competence. Once that's blurred, the parts I'm actually good at are worth less to you, because you've no way of knowing which is which.
I'd rather be narrow and reliable. It's also just the honest position, since our registration says specifically what we're registered for, and our post on checking registration explains how to verify that for anybody, us included.
What I'm actually for
Since this reads like a long list of refusals, here's the other side.
Working out what money is for and when it's needed. Whether a horizon and an arrangement match. What you already hold and whether it's doing what you think. Getting transactions done and sorting out the ones that stall. Being reachable in a bad month, which is most of the value and the least discussed part of it.
And telling you when the honest answer isn't a mutual fund at all, which happens often enough that it's a real part of the job rather than a line for a website.
What I told the client in June
We went through his investments properly. What each was for, what breaking them would cost, which ones were closest to their purpose.
Then I said the loan side needed his accountant, and that the question of how he felt about carrying debt into his fifties wasn't one I could answer for him at all. He rang the accountant, came back with the numbers, and made the call himself.
I've no idea whether it was the best possible decision. It was his decision, made with someone competent on each part of it, which is the most I can honestly aim for.
Myfolios is an AMFI-registered mutual fund distributor (ARN-145870) working from Indore since 2014. We do one thing and we'll tell you plainly when your question belongs somewhere else.
