How to Deal with the Stress of Being a Financial Advisor

Financial advisor stress is real, and you’re not alone if you’re feeling the pressure.

71% of advisors have experienced moderate or high levels of negative stress, compared to 63% of investors, according to a survey conducted by the Financial Planning Association, along with Janus Henderson and Investopedia. 

The same survey revealed that close to half (44%) of advisors feel more stressed today than they did five years ago, compared to 34% for investors. One of the respondents mentioned fee compression, shrinking margins, and increased competition as reasons contributing to stress. 

When you feel your livelihood is at risk, and when everything you’ve worked so hard to achieve can be pulled right out from under your feet, it’s understandable to feel some angst. 

That said, advisors should not let emotions and fears control them. 

Studies have shown stress makes employees less productive, and if you’re hoping to make better investment decisions to fend off fee compression and deal with this coronavirus, it’s in your interest to improve your well-being. 

4 Ways to Deal with Financial Advisor Stress

Remember You're Not Alone

We said it before, and we’ll say it again: You’re not alone. 

Remembering you’re not alone is important for two reasons: 

  1. It puts things in perspective. You’re not doing any “worse” than most of your peers in the industry. You shouldn’t feel extra pressure or shame just because you think everyone else is doing better than you; they’re not. 
  2. Someone can help you.  
    The help could be from others in the industry. If you’re connected with any RIA organizations, talk with other members and exchange stories. You might learn how others have dealt with situations similar with yours.  

    If the stress is strongly and adversely affecting mental and emotional health, speak with a therapist. 

Congratulate Yourself

You’ve made it this far in your career. For a moment, forget about the current stress you face, and think about what you have accomplished where others failed. More importantly, think about where others didn’t even get started. 

It might seem like ages since you took the CFA or CFP exams, but don’t underestimate or forget about the hard work you put in to attain your licenses. 

Dummies do not sign up to take a CFA or CFP test. The very fact you passed (multiple tests) separates you from the rest of the pack, and now you are a licensed advisor. No more than 60% pass any of the CFA exams, and a similar number will pass the CFP. Some people may take those, fail, and give up on being in the profession altogether. But you are in the profession, and you’ve made a name for yourself. 

So now you’re an advisor, and people have entrusted you to manage their hard-earned wealth. While a statement like that could sound daunting, take it as a compliment. 

Not everyone can do what you do. The clients know that. That’s why they’ve chosen you. 

You’ve worked hard before, and you’ve seen challenges. If you’ve been in the industry for more than 10 years, you’ve made it through one of the worst financial crises since the Great Depression. You are resilient. You’ll find a way to deal with the next set of obstacles, including this COVID-19 coronavirus.

Take Care of Yourself

You’re busy and stressed, but don’t let that be an excuse to not exercise, because the health risks of not exercising are greater than smoking, diabetes, and heart disease, mentioned in this study. Not exercising will only worsen the stress levels you face. 

Do not think that being “too busy” to exercise is a sign of how committed you are to your work. Rather, it is a sign of neglecting your physical and mental health, which will hurt your work performance. Poor work performance will only increase your stress levels. 

Set aside time to exercise. The Harvard Business Review would argue that people should treat exercise as if it was a part of one’s job responsibilities. 

Go for a walk or run. Hop on the bicycle or go for a swim. Sign up for that Zumba class. Whatever you prefer, do it. You’ll feel better afterwards. (Given the spread of the coronavirus, take a few extra precautions at the gym.)

As for your diet, maintain healthy eating habits and keep everything in moderation, including prescribed medications. When facing stress, it’s easy to indulge in food or drinks that bring you comfort. That’s ok from time to time, but don’t make it a habit of having one too many desserts or drinks. Consume things that keep your body and mind healthy. 

Evaluate Current Practices

Once you’ve done everything to take care of yourself, you’ll return to the office feeling refreshed. 

Fee compression and increased competition are sources of stress, but some of your current work practices could be adding to that stress, and those inefficiencies will not help you fight against shrinking margins and loss of market share.  

  • Do you find yourself spending more time on admin-related work than actual revenue-generating activity?  
  • Do you want to switch to a new portfolio accounting system, but are worried about the data migration? 
  • Can you automate mundane and repetitive tasks to allow you to focus on higher-value, human-oriented tasks? 

Asking questions like this will at least get the ball rolling to find solutions. Maybe you realize you need a cloud-based turnkey investment platform to better manage your clients' investment portfolio data and reports. Perhaps you can outsource your middle- and back-office activities. 

Rather than be overwhelmed, at least now you can start thinking about solutions with a clear mind. 


Advisors Should Not Be Controlled by Stress

It’s understandable to feel the pressures of lower profit margins and higher competition, but letting that pressure control you is a recipe for disaster. 

Combine those external pressures with self-loathing and a lack of physical care for the body, and the stress levels will increase and result in less productivity and lower mental performance. 

When facing stress, remember that you’re not alone and that you are worthy of self-congratulations. You have skills others wish they had but do not have, and you’ve shown resilience through tough times before. Don’t forget to exercise and keep your indulgences in check. Once you’ve successfully taken care of the self, you’ll make better decisions that relate to improving your work situation. 

You can’t control everything that happens in this industry, but you have control over your well-being.  

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