Adviser Wellbeing

Study finds pressures on advisers

BY ERIC FRYKBERG

What’s the biggest task facing advisers? Reading and answering emails according to a new survey.

The percentage of time spent on emails was 15.54%. Answering phone calls and texts took up a further 8.82%.

Adding admin and government compliance to the mix came to almost half of most advisers' working day.

By contrast, their core business, dispensing financial advice, took up 10.72% of working time, and drumming up new business a mere 4.63%.

This imbalance contributed to a high level of stress among many advisers.

In some cases, they had sleepless nights.

These are among many findings of a new study of the financial advice industry.

The study comprised a survey of 500 advisers in New Zealand. It was funded by the insurance company AIA and carried out by the Australian research firm E-Lab and an academic from Deakin University in Victoria.

Their research produced some dramatic results, including 41% of advisers having either moderate or high risks to their mental health.

Broken down further, the three most significant categories of risk were people who said they were ‘tired out for no reason’, they were ‘nervous’ and they found that ‘everything is an effort’.

The next two most significant categories were people who said they were “depressed ' or felt 'hopeless'.

Despite these trends, New Zealand advisers can take some comfort from the fact that the situation is even worse in Australia.

In this country, the moderate and high risks to mental health affected 30% and 10% of financial advisers respectively. In Australia, the figures were 38% and 19%.

This was attributed to the bureaucratic complexity of running a brokerage being even worse across the Tasman than it is here.

Sticking with the New Zealand figures, the study goes on to look at just how stress affects financial advisers.

The biggest single impact was the ability to sleep. Just on 17% of advisers strongly agreed that work stress kept them awake at night, while 28% 'somewhat agreed ' with the same statement.

The stress level led 10% to strongly feel that they might quit their job while 16% somewhat agreed they might.

Stress was also affecting their weight, with 10% believing that strongly, and 22% thinking it was somewhat true.

The survey did go further into this, so it is unclear whether advisers were putting on weight by eating comfort food during trying moments, or losing weight from stress and worry.

Despite these negatives, financial advisers revealed some positives in the survey. They were usually absorbed by their work, or fully engaged by it, for much of the time. They were 'in the zone', and time in the office did not drag.

Even so, financial advisers' mental involvement in their work fell short of two occupations that were compared, school principals and partners of companies such as law and accountancy firms.

Work-life balance also fared quite well. Just on 67% of advisers could achieve home and work expectations, often or mostly. Around 24% could achieve this balance sometimes and 9% managed this goal rarely or never.

Again, the figures were worse in Australia.

The survey then went on to look at the sheer quantity of work imposed on advisers and the record in New Zealand is poor, though again, less bad than in Australia.

A clear majority agreed, or strongly agreed that they had no time or energy, that they needed more hours in the day and that they never seemed to catch up. And the source of all that pressure appears to fit in neatly with life in a post CCCFA world. The difficulty of complying with Government rules was the worst bugbear by far for those who found work stressful or very stressful. The figure was 61%, way ahead of the next worst factor, work overload, at 42%.

And a clear majority of advisers felt emotionally drained, burnt out or frustrated by all this.

Exercise was the most common way of dealing with these feelings, followed by a 'debrief' with others. The survey does not say what form this debrief takes, but it is likely to be a beer with buddies after work in at least some cases. Another outlet from pressure at work was private hobbies or pastimes.

The survey revealed other factors, such as people with higher education qualifications generally doing better in nearly all areas. Stress is lower for people with degrees and much lower for postgrads.

Age played a part as well. People over 60 had a better work-family balance, less stress and higher overall wellbeing. Gender also affected people's work. Female advisers had less work-family balance, and a higher work overload than males, they also had more stress.

In another finding, women made up 40% of loan advisers but only 29% of all other adviser roles.

In another positive from the survey, the majority of New Zealnd advisers were proactive in terms of seeking industry support. Overall, more than 50% were receiving moderate to high levels of support, and in that, they did better again than their Australian counterparts,

The largest source of support was from industry peers – 53%. Product manufacturers helped provide support in 51%, of cases and FAPs or other groups came through in 46% of cases.

Advisers were generally proactive around using recovery and self-care both at work and at home to manage their stress levels, with around 61% of advisers undertaking exercise often to very often, and 54% undertaking a hobby or other interest often to very often.

In a sign that the use of alcohol to ease work stress may be a problem for some advisers, the survey results showed that 6.8% of NZ Advisers used alcohol most of the time and a further 12.1% used it frequently to reduce stress. Of less concern, 24.1% used alcohol sometimes to relieve stress. However the majority either did not use alcohol at all (33.1%) or rarely (23.9%) used alcohol for stress relief.

However the figures did show a reliance on alcohol by a significant portion of advisers.

In terms of cognitive skills to manage the challenges of the job, the advisers scored reasonably well. In another development, they did not differ significantly from Australian advisers in terms of openness to change, capacity to embrace and drive innovation and ability to be adaptive in their behaviour.

Where they did differ was in their mindset towards their work. New Zealand advisers were more hopeful (10% higher), more resilient (9%), and more optimistic about the future (14%) than Australian advisers.

In a final comment, the advisers said the increase in compliance and regulation had already had a negative impact on them.

They were very concerned that New Zealand would go down the same road as Australia where regulatory demands were not only having a negative impact on their mental health and wellbeing but were also leading to advisers becoming disengaged and more likely to leave the industry.

They said that for this profession to flourish in New Zealand, the regulators in New Zealand should be careful not to follow the same path taken in Australia. ✚

Identified key sources of stress