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Former baseball player and manager Yogi Berra once quipped that baseball is 90% mental and the other half physical. It’s
a humorous way to keep in mind the mental aspects of the sport.
Advisors, like athletes, need to pay attention to their mental game. The 2008-2009 economic downturn affected client portfolios—just as importantly, though, it had a sociological impact on advisors and on clients. In our latest survey, conducted in November-December 2009, almost 60% of advisors said that their quality of life was negatively affected by the economic downturn. Only 9% of financial professionals said their quality of life was positively affected and one-third (33%) said their quality of life was not affected.
Clients rely on investment advisors not just for their experience and expertise in investment management, but also because of their outlook. It’s therefore crucial for financial professionals to have the right mindset even in challenging times. In order to recharge themselves and provide support to clients as well as leadership to their practices, 54% of advisors are spending more time with family and friends, 50% have enhanced their exercise routine, 29% have changed their diet regimen and 23% have engaged in a personal hobby.
Ways RIAs Recharge Themselves Mentally
Despite the challenging market environment, job satisfaction remains high for RIAs. On a scale of 1 to 5, 84% of advisors surveyed gave top ratings (4 or 5) to job satisfaction. Though it’s a highly rewarding profession, being an investment advisor can be stressful. On a scale of 1 to 10, the average level of stress is about 6. Compared to a year ago, the stress level increased for 34% of RIAs and decreased for 45%. For 21% of advisors, the stress level remains the same as a year ago.
RIAs' Level of Stress
Building your resilience
Resilience involves maintaining flexibility and balance in your life as you deal with stressful circumstances and traumatic events. This happens in several ways, including:
- Letting yourself experience strong emotions, and also realizing when you may need to occasionally avoid experiencing them in order to continue functioning
- Stepping forward and taking action to deal with your problems and meeting the demands of daily living, and also stepping back to rest and reenergize yourself
- Spending time with loved ones to gain support and encouragement, and also nurturing yourself
- Relying on others, and also relying on yourself
Source: American Psychological Association |
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In the next year, advisors (72%) expect to grow their businesses. As their businesses grow, the pressure will likely keep pace. While several factors should contribute to booming growth for financial advisors—including the fact that baby boomers are retiring and the financially savvy Generation X is reaching its peak earnings years—it’s getting harder and harder to succeed in the business. Taking some of these measures to handle stress and recharge will not only help your mental health, but will also help you offer better service to your clients.
- Find balance—don’t neglect your health by focusing only on work
- Focus on what you can affect
- Devote time and energy to an issue that’s really important to you and your clients
- Get enough rest
- Spend more quality time with your family and friends
- De-stress and recharge so you can lead with energy, wisdom and confidence
- Boost your self-esteem by setting meaningful, achievable goals and by continually working on your skills to improve your value to your clients
- Eat a balanced diet
- Exercise to relieve stress and lift your mood
Remember, as in baseball, the advisory business is 90% mental. Investment professionals who are emotionally healthy are better able to handle life’s inevitable challenges, build strong relationships with their clients and lead productive, fulfilling lives.
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