Financial advisors may be more stressed than their clients. According to a study by the Financial Planning Association, 63% of investors experience high or moderate stress, while 71% of advisors admit to being stressed out.
The amount of stress also appears to be increasing for a large chunk of the profession: 28% of financial advisors reported having more stress than they did in the prior year, and 44% said they had more stress than they did five years earlier. These numbers were also lower for clients.
The health effects of stress is one area that may have worsened in recent years. In the FPA study, conducted just before the COVID-19 pandemic, 46% of respondents said stress negatively affects their health. Multiple other studies have shown that up to 90% of doctor visits in the U.S. are for stress-related conditions, ranging from anxiety and depression to heart disease. The pandemic, recent inflation and market volatility have only added to the population’s stress levels.
Financial advisors are human, just like everyone else, and they face difficult personal and professional situations that can lead to stress and even health issues. But what can they do about it? Here are some ways financial advisors can deal with stress and ensure optimal physical and mental well-being, both at work and in their personal lives:
— Identify stressors.
— Control what can be controlled.
— Accept what cannot be controlled.
— Plan and organize.
— Strive for work-life balance.
— Maintain a healthy lifestyle.
— Adopt a positive attitude.
— Pursue happiness in life.
Some of the stress factors that respondents to the Financial Planning Association study named were: keeping up with regulations, fee compression, shrinking margins, increasing competition, the health and outlook of the business, maintaining work-life balance, poor business planning, an uncertain financial situation, and the failure to achieve goals.
Financial advisors must be realistic about their personal situation and admit to their stressors. The first step toward solving a problem is identifying it as one. Being honest with yourself about what causes your stress is a key first step toward physical and mental well-being.
Control What Can Be Controlled
Advisors do have a level of control over how much some of the stressors above affect them on a daily basis. Business planning and steps toward the achievement of goals, for example, can be more efficient and productive. So, to reduce stress, advisors must take charge and make adjustments to control what can be controlled.
New processes or organizational strategies can be put in place to take some of the guesswork out of everyday operations, and delegating certain tasks to the appropriate staff members or outsourcing to other professionals can relieve some of the workload.
Accept What Cannot Be Controlled
Some stressors, of course, are not things that advisors can totally control. For example, advisors may be able to anticipate government regulations and adapt to them, but they are not in control of what the government will require at a particular time.
Market downturns and recessions will have an impact on client portfolios despite the best laid plans. Lower fees, increased competition, and the higher cost of doing business are also factors that result from the competitive free market. Advisors can do their best to adapt to such situations, but they can’t control them.
Rather than panicking under less-than-optimal conditions or being reticent in the face of change, advisors can focus on putting mechanisms in place that will limit their business’s vulnerability in the future.
Plan and Organize
Dutiful commitment to business planning is one example of a way to avert stress. Advisors may create detailed plans for their clients, but they often forget that they need to plan for their own business and life.
Without a planning strategy, advisors may be disorganized and struggle to execute tasks that lead to the achievement of goals, two things that increase stress and cause burnout. Plan ahead and stick to the plan.
Strive for Work-Life Balance
Work-life balance does not drop out of thin air. It requires effort and discipline. Some people do it by ensuring that they don’t bring any work home, even turning off their phones during family time. For some it means no work over the weekend, or no calls or emails from work during vacations and holidays.
There are no hard-and-fast rules here. The key is to spend more time with the people who matter to you, and that requires planning and commitment.
Maintain a Healthy Lifestyle
Living a healthy life is also a choice that advisors can make to reduce stress and burnout. This can include sleeping well, taking an afternoon nap, exercising regularly, taking evening walks, eating well, and spending quality time with friends and family.
All of these practices will improve the physical and mental health of advisors. And with better well-being comes higher productivity.
Adopt a Positive Attitude
Life isn’t butterflies and rainbows for most people, but a generally positive approach to life that accepts difficulties as a part of the human experience can be valuable. Another way to put this is that advisors should embrace an “expect the best and prepare for the worst” mentality. This approach is helpful on a couple of fronts: It’s optimistic because there’s an expectation for best outcomes, but it is also realistic because it accepts that sometimes things don’t work out as planned.
Positivity will help advisors stay motivated and hopeful, and preparing for the worst can help avoid shock when bad things happen. This approach also helps advisors stay in the right frame of mind to seek solutions to problems rather than being overwhelmed by them.
Pursue Happiness in Life
Different things make different people happy, and advisors should try to identify their recipe for happiness and spend more time adding ingredients. If this includes time with loved ones, they need to make a conscious effort to spend more time with them. If it includes volunteering for a charity, they need to put specific blocks of time on their schedule.
A happy life not only counteracts stress and boredom, but it also makes moving past difficult situations a less daunting task.
Yes, even advisors get the blues, but by identifying stressors, controlling what can be controlled, and reacting well to what cannot be controlled, they can live in physical and mental harmony. And not only will the advisors reap the benefits, their clients will, too.
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Even Advisors Get the Blues: Managing Stress as a Financial Advisor originally appeared on usnews.com