Advisors Remain Stressed but Professionally Satisfied, Second Annual FlexShares Advisor Wellness Survey Finds

FlexShares Exchange Traded Funds (ETFs) today announced the results of their second annual financial advisor wellness survey, which found that advisors are 23 percent more stressed than the national average, down only slightly from last year’s 25 percent, but nonetheless remain overwhelmingly satisfied with their career choice. Advisors reported 79 percent job satisfaction overall, with advisors who manage over $250 million in assets reporting 12 percent higher satisfaction than their peers with fewer assets under management.

The survey of over 600 advisors found that challenges associated with growing their practices (27 percent) and compliance and regulatory issues (19 percent) continue to be the top stress inducers, with nearly half of those surveyed citing these as their primary sources of work-related stress. However, new sources of stress arose in 2018 as well, including political uncertainty and market volatility. Advisors ranked ‘political uncertainty,’ a new choice in the survey this year, as the top source of stress behind compliance and client growth at 18.5 percent and 27.2 percent respectively. Furthermore, while the state of the markets ranked relatively low on advisors’ list of stress-inducers for 2017, it increased by almost 19 percent in 2018.

“Despite growing pressures posed by factors outside of advisors’ control, like political risk and market volatility, advisors remain highly satisfied with their career choice,” said Darek Wojnar, Head of Funds and Managed Accounts. “To maintain this level of satisfaction potentially heading into an increasingly volatile market, it’s critical for advisors to seek out investment solutions that can meet their investment and business goals over the long-term and to devote the time needed to create an exceptional client experience.”

Advisor Stress Not Created Equal

New to the study this year, FlexShares further analyzed specific areas of stress and the breakdown of results across the advisor space. They found that advisor stress levels varied based on the type of firm and services offered, particularly in response to certain areas such as fees and regulation. RIA respondents indicated fee and margin pressure as the least concerning business stressor compared to their peers, whereas regional advisory firms reported the highest levels of stress in that area. Furthermore, in an open-ended question about stress related to regulatory changes, RIAs were more likely to describe these changes as “not stressful,” compared to wirehouse advisors who described new regulation as posing “business risks” and “interfering with client perceptions.”

The survey also found differences among advisors based on the level of services offered to clients. Advisors who described their role more holistically in terms of “wealth management” or “financial planning,” were 31 percent more stressed than those who described their role solely in terms of “investment management.”

“As advisors shift towards managing an increasing portion of their clients’ financial lives through comprehensive wealth planning, our results show this may lead to greater levels of stress,” said David Partain, Head of Marketing at FlexShares. “By working with external partners that prioritize their success and well-being, advisors can better manage these changes and lead more fulfilling, satisfied lives.”

Gaining Peace of Mind

In addition to identifying the sources of their stress, advisors were asked to detail how they’re managing this stress. Confirming last year’s survey findings, FlexShares again found that advisors who change their work habits, such as time management, delegation, and enhancing client relationships, are more likely to reduce stress than those who rely on methods outside of work, like meditation, exercise, or leisure activities. Those who used outside of work strategies were 19 percent more stressed than advisors who implemented on-the-job changes. This shows that the best way for advisors to handle the stresses of the job is to tackle them head on.

About the FlexShares Advisor Wellness Survey

This is the second iteration of an annual survey by Northern Trust’s FlexShares on financial advisor wellness. The survey was conducted in October and November 2018 and a total of 632 advisors participated. This survey aims to provide insight into work-related stress for advisors and the strategies they use to manage this stress, with the intent to measure trends over time. To view more results, visit https://go.flexshares.com/wellness.

About FlexShares

FlexShares Exchange Traded Funds are designed to pursue specific investment goals across both passive and active strategies. FlexShares offers differentiated ETF strategies that improve and simplify the investment decision process for the long-term investor. Follow us on Twitter @FlexSharesETFs.

About Northern Trust

Northern Trust Corporation (Nasdaq: NTRS) is a leading provider of wealth management, asset servicing, asset management and banking to corporations, institutions, affluent families and individuals. Founded in Chicago in 1889, Northern Trust has offices in the United States in 19 states and Washington, D.C., and 23 international locations in Canada, Europe, the Middle East and the Asia-Pacific region. As of December 31, 2018, Northern Trust had assets under custody/administration of US$10.1 trillion, and assets under management of US$1.1 trillion. For more than 125 years, Northern Trust has earned distinction as an industry leader for exceptional service, financial expertise, integrity and innovation. Visit northerntrust.com or follow us on Twitter @NorthernTrust.

Northern Trust Corporation, Head Office: 50 South La Salle Street, Chicago, Illinois 60603 U.S.A., incorporated with limited liability in the U.S. Global legal and regulatory information can be found at https://www.northerntrust.com/disclosures.

Before investing, carefully consider the FlexShares investment objectives, risks, charges and expenses. This and other information is in the prospectus, a copy of which may be obtained by visiting www.flexshares.com. Read the prospectus carefully before you invest. Foreside Fund Services, LLC, distributor.

An investment in FlexShares is subject to numerous risks, including possible loss of principal. Fund returns may not match the return of the respective indexes. The Funds are subject to the following principal risks: asset class; commodity; concentration; counterparty; currency; derivatives; dividend; emerging markets; equity securities; fluctuation of yield; foreign securities; geographic; income; industry concentration; inflation-protected securities; infrastructure-related companies; interest rate / maturity risk; issuer; large cap; management; market; market trading; mid cap stock; MLP; momentum; natural resources; new funds; non-diversification; passive investment; privatization; small cap stock; tracking error; value investing; and volatility risk. A full description of risks is in the prospectus.

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