How to Deal with the Stress of Being a Financial Advisor

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

According to a survey carried out by Financial Planning Association, Janus Henderson, and Investopedia:

• 71% of advisors have experienced moderate or high levels of negative stress, compared to 63% of investors.
• 44% of advisors feel more stressed today than they did five years ago.
• Stress levels among financial advisors are 25% higher than the norm for US workers.

One of the respondents mentioned fee compression, shrinking margins, and increased competition as reasons contributing to stress.

And an Australian study shared similar findings:

• 75% of advisors surveyed experienced “high levels of burnout from work.”
• Of that 75%, 33% were seeking medical care to manage their stress-related symptoms.
• 42% of advisors were considering leaving the profession due to stress-related issu

It’s been a wild past 3 years:

• The pandemic-related March 2020 market crash
• Social isolation, anxiety, and family-related challenges during lockdowns
• High inflation
• Market volatility
• Increased social and political conflict globally
• The rise of AI and fears of it"replacing" financial advisors

It’s understandable to feel pressure, but financial advisors should not let the pressure control them.

Studies have shown stress makes employees less productive.

And if you want to improve your investment performance, you must invest in your well-being. 

4 Ways to Deal with Financial Advisor Stress

1. 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 - Keep Perspective

You’re not doing any “worse” than your peers. Don’t add extra pressure or feel shame just because you think everyone else is doing better than you; they’re not.

2 - Someone Can Help‍

If you’re connected with any RIA networking groups, talk with others 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.

2. Congratulate Yourself

You are living someone else's dream.

For a moment, forget about the current stress. Think about how far you've made it in your career.

It might seem like ages since you took the CFA or CFP exams, but remember the hard work it took to attain your licenses. Those tests are not for dummies.

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, making a name for yourself. 

Now you’re an advisor, and people have entrusted you to manage their hard-earned wealth.

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

If you’ve been in the industry the last 15 years, you’ve made it through the worst financial crisis since the Great Depression, a pandemic, and you’ll find a way make it through the current obstacles.

3. Take Care of Yourself

You’re busy and stressed, but don’t use that as an excuse not to exercise.

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. 

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. 

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. 

4. Evaluate Current Practices

Once you’ve taken care of yourself, you’ll return to work feeling refreshed. 

Fee compression and increased competition are sources of stress, but your current work practices might add to that stress:

• Spending too much time on manual and repetitive work, rather than revenue-generating activity.
• Over-paying for software and services
• Relying too much on in-house staff to develop applications and platforms
• Having poor documentation or a lack thereof, making it harder to train and transfer knowledge to staff

Thinking about these pain points will get you thinking about solutions:

• Automate manual workflows
• Outsource middle- and back-office functions
• Meet with investment operations consultants

Empaxis supports financial advisors in all these areas, making their jobs easier by freeing up time and resources to earn more money for clients and themselves.

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 stress levels will increase, resulting in reduced productivity and performance. 

When facing stress, remember you’re not alone and you are worthy of self-praise. You're doing what others wish they could, and you’ve shown resilience through tough times before. 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 can always control your well-being and the effort you put in.