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Advisors are uniquely in a tough spot because not only are they often worrying about their clients’ money, they may be worried about their own finances as well.

CentralITAlliance/iStockPhoto / Getty Images

The COVID-19 pandemic has been stressful for Canadians worried about their investments, jobs and overall well-being. The same could be said for the financial professionals who advise them.

In fact, financial advisors may be feeling even more stress than the individuals for whom they manage money, according to a recent report by Toronto-based human resources services and technology provider Morneau Shepell Inc.

Data from that company’s “The Mental Health Index Report,” published in May, revealed that workers in Canada’s financial services industry trailed only individuals working in accommodation and food services, arts, entertain and recreation, and real estate, rental and leasing for the lowest mental health scores.

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What’s notable is that these people were all affected deeply by the COVID-19 stay-at-home recommendations as these industries were virtually shut down completely at the time. In contrast, financial services workers were considered essential in most provinces.

That advisors are feeling stressed out is hardly surprising to one of Canada’s leading experts on advisor psychology.

“The biggest source of stress in people’s lives is money,” says Dr. Moira Somers, a psychologist and executive coach in Winnipeg who works with advisors in her practice, Money, Mind & Meaning.

In this respect, advisors are uniquely in a tough spot, she says. They’re often not only worrying about their clients’ money; they may be worried about their own finances.

“[Advisors] are often compensated on the basis of assets under management. So as [assets] decline 30 per cent, for example, so too does advisors’ [revenue and take-home pay],” Ms. Somers says.

That’s not even accounting for the fact their own investment portfolios could be falling in value, too. But while markets have recovered from their March swoon, she notes many advisors may still be experiencing “mental depletion.”

That’s a key reason why Ms. Somers hosted a webinar in early June titled “Worn-out clients, worn-out advisors. What could possibly go wrong?”

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That webinar was the second in a series aimed at helping advisors navigate the COVID-19 world – and it experienced a dramatic drop in viewers compared to its predecessor, which focused on helping soothe clients’ anxiety.

Again, Ms. Somers says she’s not surprised, nor are other experts like Carl Richards, a certified financial planner (CFP) who writes the popular weekly New York Times column “Sketch Guy” that often focuses on the psychology of the financial services industry.

“I appointed myself vice-president of unspeakable things a few years ago and just started talking about [stress and other mental health issues] at conferences [for advisors],” Mr. Richards says. “I’d always get the same response: folded arms and very stoic looks.”

Yet, many advisors would approach or e-mail Mr. Richards after his presentation thanking him for addressing the issue.

“It turns out advisors are just like most other humans. [Our mental well-being] is not something we like to talk about freely,” he says.

Indeed, Mr. Richards says that although the worst of the market upheaval from the pandemic may be largely over, wealth professionals could still feel stress resulting from the continuing uncertainty. A 2013 Kansas State University study of advisors’ experiences during and after the global financial crisis of 2008-09 revealed that many exhibited symptoms of post-traumatic stress.

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One its authors, Dr. Brad Klontz, a financial psychologist, says the research found that 96 per cent of advisors surveyed experienced medium to high levels of post-traumatic stress resulting from that stock market crash.

“I believe we’re going through the same thing right now,” says Mr. Klontz, a CFP in Colorado and associate professor at Creighton University’s Heider College of Business in Omaha, Neb.

Among the symptoms reported were trouble sleeping and concentrating. As well, individuals often ruminated on bad experiences.

But Mr. Klontz says these experiences shouldn’t be viewed as entirely negative. Individuals feeling post-traumatic stress – not to be confused with post-traumatic stress disorder – should understand it can present “an opportunity … something called post-traumatic growth.”

Individuals who deal with their stress constructively, making changes to their lives and practices, are often better prepared for future upheaval. Mr. Klontz adds that they may even “surpass their level of functioning before the original crisis.”

Of course, many individuals feeling the negative effects of a crisis may not always recognize the symptoms, Ms. Somers says.

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“You don’t have to be clinically depressed or anxious,” she says. “You don’t have to rotting your liver by drinking too much. It can just be the signs that you’re getting worn out.”

Like most other professionals who help people day in and day out, advisors can become mentally depleted at the best of times, Ms. Somers adds. Indications include being less patient or empathetic. That might manifest as cutting clients short with respect to discussion about their financial worries.

Often, advisors who are feeling stressed “just want to get straight to the problem-solving,” she says. “That might feel efficient… but they’re not using their emotional intelligence [because they’re] burned out.”

Mr. Klontz suggests less experienced advisors may be more at risk, whereas veteran ones “seeing their third or fourth [bear market] are the most calm.”

That was the case for Robert Pollard, portfolio manager with the Wyndham Group at Raymond James Ltd. in Toronto.

“I wasn’t worried about markets,” he says, adding that this time he felt a “calmness that wasn’t there in the past.”

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Rather, Mr. Pollard says he was more worried about older clients’ mental state at the pandemic’s onset.

Surprisingly, rather than fearful, he found them resilient and able to lean on past experiences to ground them including, for a few, surviving the Holocaust.

“They weren’t down at all and it made me think, ‘Wow. There are lessons to be learned.’”

Ms. Somers adds the lessons to be learned about wellness aren’t just for advisors, but the entire industry.

“It’s critical for branch managers, firm owners and team leaders to check regularly on the well-being of their people,” she says. “It’s about creating a culture in which people are not only encouraged to turn off, but required to do so.”

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