Stocks Up, Satisfaction High -- But Advisor Stress Rises
Markets are rising, job satisfaction is high -- but stress levels are increasing for financial advisors.
That's the confusing conclusion that emerges from a recent survey released by Adhesion Wealth Advisors Solutions, outsourced service provider for financial advisors.
Just under two-third of the advisors surveyed said their stress level has risen in the past year. And 79% of respondents rated their job's stress level was above a 7 on a 10-point scale.
But job satisfaction is high as well; 68% of respondents rated the enjoyment they get from their work as a 7 or higher -- suggesting that stress and contentment in the wealth management industry are not mutually exclusive.
So why are advisors stressing?
'THINGS AREN'T ADDING UP'
Richard Dragotta, an advisor with LPL Financial and founder of INC Advisors in Paramus, N.J., suggests that while stocks have risen, market conditions remain challenging.
"Pessimistically, it just seems like a lot of things aren't adding up in terms of the economy with how the markets are behaving," Dragotta says. "The opportunities are less and less, and more people are trying to catch the tail of something. Making new highs all the time is stressful, and having less and less conviction to come up with solutions for clients makes it a little more stressful."
While markets are at an all-time high, Dragotta says he worries that "we're in a bubble" -- and suggests that the challenges are common to independent wealth managers and RIAs across the industry.
He may be on to something. The most common stressor among respondents was the "weight of responsibility for the financial well-being" of their clients, which 52% of the advisors surveyed rated a 9 or a 10. The second largest stressor was "client demands and expanding services" -- rated a 9 or 10 by nearly 37% of respondents.
Dragotta also cites a more challenging regulatory and compliance environment as contributing to advisors' stress. "That's part of managing the business in a way that takes away from other parts of the business,"he says.
Half of the advisors surveyed also said that finding a balance between their work and their personal lives was a challenge. Dragotta says the "digital and electronic age" is a contributing factor.
"It feels like you're always on call," says Dragotta. Even deciding to block off personal time -- by not checking emails or taking calls -- can add stress. "Most advisors make a conscious decision to [block off time], which could be stressful for a lot of folks with the world that we live in with the access that clients have to us and the level of competition we have out there."
The Adhesion survey gathered information from advisors working in multiple channels; the average AUM of participants was near $450 million.