While it is true that the vast majority of financial advisors fail, today’s article is focused on advisors who make enough money to survive but fail to achieve their goals.
Before we dive in, let’s review why most financial advisors fail.
If you look at the corporate model of most financial services firms, their business model assumes that 90-95% of advisors or agents will fail.
And because of this, most firms focus their new agents on approaching family and friends (similar to network marketing). They don’t teach them how to manage their mind and identify a niche they love or how to track their activity, numbers, and results.
By the time the person has gone through their family members and friends, they are out of leads and have often lost friends in the process.
So what can you do regardless of where you are in the process of growing your financial advisory or money coaching business?
Today we are diving into the overview of
Why Financial Advisors Fail and What to Do About It
I have run one of the most successful performance masterminds for financial advisors and money coaches worldwide for over 17 years.
And while I can’t guarantee results, I can share that we have never had an advisor, consultant, or coach who has done the work fail to have measurable results.
That said, we have members who don’t do the necessary work. As a result of their actions, they do not achieve their goals.
Over the next several weeks, we will dive into insights you need to master so you can join the elite group of financial advisors and coaches who manifest their dreams and achieve their ultimate goals.
If you struggle with your mindset, download our Mindset Mastery guide, click here:
5 Steps to Succeed as a Financial Advisor or Money Coach
- 1. Managing your brain.
- 2. Creating a plan.
- 3. Identifying a niche.
- 4. Mastering your money and mindset.
- 5. Executing consistently.
Today, we will review the first insight. Over the next several weeks, we will address the other steps.
1. Managing your brain
When I began in this business over three decades ago, one of the most common sayings was, “Successful people do the things others won’t or don’t do.”
I would add, “Successful people do things they don’t feel like doing” or “Successful people focus on how they want to feel once they achieve their goal as compared to how they feel in the moment.”
People want to achieve a goal because of how they believe they will feel once they reach it. So, you must get clear on your ultimate goal and the feeling you want to experience.
Then regardless of the day, task, or how you feel in the moment, you stay focused on your ultimate goal and complete the activity required to achieve your desire.
To better understand this, you need to understand your mind. For simplification, we will focus on your subconscious and conscious mind. And what gets in the way of doing the activities required to achieve your desired goal.
Your subconscious and conscious mind
The subconscious mind is often called your Primal, toddler, or child brain.
It is governed by emotions, how we feel, and what we want. Left unattended your primal brain will run havoc on your business and life. Most people (financial advisors included) live their lives with this part of their brain running their lives.
When you think about it, it truly is insanity. Is there a child you would let run your business? And yet, when we leave our primal brain in charge, that is what happens.
The conscious mind is part of the prefrontal cortex. It helps you focus, plan, set goals, manage impulse control, and manage emotional reactions.
To achieve any goal, you must first know what you want. Then you need to get your entire brain working together to achieve them.
Neurological Reasons Why Financial Advisors Fail
It is helpful to understand chemical reactions in the brain to understand why we do certain things and not others. These reactions affect our behavior.
One of the most impactful neurotransmitters that impact why financial advisors fail is dopamine.
It is a neurotransmitter associated with motivation, reward, and pleasure.
Dopamine plays a crucial role in the brain’s reward system, reinforcing behaviors that lead to pleasurable outcomes.
When we engage in activities that provide immediate gratification, such as scrolling through social media, watching entertaining videos, or eating our favorite food, dopamine is released, creating a sense of pleasure. This can lead to procrastination if we prioritize short-term rewards over long-term goals that require effort and delayed gratification.
For some, pursuing behaviors that raise dopamine levels can become compulsive and addictive. Examples include gambling, substance abuse, overspending, or overeating.
And while you may not have an extreme addiction, you may have behaviors that keep you from achieving your goal.
If you need support with your business or would like to know the next best step on your journey, click here to take our Next Step Business Assessment:
For example, which of these dopamine hits do you regularly experience?
- Scrolling social media
- Checking the number of likes you got on a recent social media post
- Having a snack instead of making your warm calls
- Calling a friend instead of completing your blog post
- Checking email several times during the day
- Playing video or games on your phone or computer
And while completing these actions may seem like no big deal, they waste your valuable time and keep you from completing the activities that will allow you to succeed and achieve your goal. For example, you have time on your calendar to make warm calls, but you are scrolling social media to see what your friends are up to. Or you are commenting on clients’ posts and justifying that the action is a high-value activity.
Maybe, instead of completing your blog post, you check your email for the fifth time during the day. Perhaps a client sent an urgent email, or a referral has sent you a message.
Regardless of the reason or excuse, dopamine gives you an instant reward (very similar to the effect of morphine) for completing some activities and avoiding others.
Successful producers focus on their long-term goal and the desired feeling they will experience when they achieve it. They understand that achieving their goal, requires completing activities regardless of how they feel at the moment.
Another neurotransmitter that impacts your actions and results is serotonin.
Serotonin is a neurotransmitter that affects mood, sleep, well-being, and impulse control. Imbalances in serotonin levels can influence a person’s ability to regulate emotions and manage their behavior effectively.
Low serotonin levels have been associated with decreased impulse control and increased impulsivity. This can contribute to procrastination, making it challenging to resist immediate distractions or delay gratification.
Another neurotransmitter that contributes to lackluster results may be caused by norepinephrine.
Norepinephrine is a hormone and neurotransmitter involved in the body’s stress response. It plays a role in regulating attention, focus, and alertness.
When norepinephrine levels are low, it can lead to difficulties in maintaining concentration and sustaining effort, making it easier to succumb to distractions and procrastinate.
Another chemical that impacts performance is cortisol. This is a stress hormone released in response to perceived threats or stressors.
Chronic stress can lead to elevated cortisol levels, impairing cognitive function, decision-making, and self-control. High cortisol levels can contribute to a sense of overwhelm and distractibility, making staying focused and completing tasks more challenging.
Conclusion: Why Financial Advisors Fail in Achieving Their Goals
It is important to remember that chemicals and their effects can influence our behavior. However, they are not the only factors behind failures or procrastination.
Psychological factors, such as fear of failure, perfectionism, lack of self-confidence, and poor time management skills, also impact our behaviors. Additionally, environmental factors, such as distractions, lack of structure, or unclear goals, can contribute to your lack of desired results.
Achieving results requires a combination of self-awareness and effective time management.
Examples that can help you increase focus and productivity include:
- Minimizing distractions,
- Breaking tasks into smaller, manageable steps,
- Setting clear goals and deadlines, and
- Practicing self-discipline.
Now that you understand some of the neurological reasons why financial advisors fail, our next insight will review behavior issues that get in the way of achieving your desired outcome.
If you want more success in your business, download our free Advisor Marketing Guide here: