Are You The Customer or Product?

Apple CEO Tim Cook once said, “When an online service is free, you’re not the customer. You’re the product.” Its relevance in the world of personal finance today is striking - especially in how people buy insurance, invest in mutual funds, or choose stockbrokers.

There’s a growing trend of consumers going the “cheaper” route - buying term insurance and health insurance online, picking the lowest-cost mutual funds, and signing up with zero-commission brokers. It feels smart at first. Low premium, low fees, no middleman. But problems begin when it’s time to act.

Many forget to pay insurance premiums on time, miss out on critical riders, or end up buying the wrong plan altogether. Renewals are overlooked. When a claim arises, they realise there’s no one to guide them. The same “no-agent” policy now becomes a source of stress, not savings.

In stock markets, traders and investors are lured by ultra-low-cost brokers. But when there's a glitch, an outage, or their order doesn’t go through on a crucial day - there’s no one to turn to. No advice, no accountability. And when the portfolio bleeds, the only help is a chatbot.

The same applies to mutual funds. People pick direct plans or index funds based only on low expense ratios. That’s the worst way to pick schemes. Picking schemes is a science based on multiple formulae. Besides, market cycles, goals, categories, and strategies matter - not just cost. With thousands of schemes across various categories, an advisor helps you pick the right ones based on market scenarios - whether for SIPs or lumpsum investments. People try to avoid the cost of professional help - and end up paying a bigger price in poor returns, missed goals, and emotional exits during market corrections.

A smart advisor will help you raise a loan against the mutual fund, instead of selling it (which will trigger capital gains and opportunity loss from future gains). People eventually realise, nobody is really there to help in operational tasks. The platform is low-cost, yes - but also low-support.

In personal finance, avoiding a small fee today often creates a big regret tomorrow. The real cost isn’t what you pay - it’s what you lose when things go wrong.

As Cook rightly implied, when it’s too cheap, you’re not the client - you’re just a transaction. True value lies in quality advice, timely action, and having someone in your corner when it matters most. In finance, the most expensive thing isn't fees. It’s going solo.

Bottomline

For all investments and insurances, always trust a well-qualified full-time entrepreneur as an advisor. He has the necessary education, wisdom, expertise and experience to help you achieve your financial goals. Because the cost of doing nothing - or worse, doing it wrong - is often far greater than the cost of sound advice.

(The author is a Chartered Accountant and CFA (USA). Financial Advisor.

Views personal. He could be reached on 9833133605.)