As the number of vaccinated Americans continues to climb and the nation turns the corner on the pandemic, financial advisors are starting to get a clearer view of their post-Covid environment.
The pandemic hasn’t been a simple interruption. As our recent FlexShares Advisor Wellness Study found, the pandemic changed advisors’ businesses, work routines and work-life balance. And it altered behaviors of clients and prospects. Many of these changes are likely to become permanent, shaping the way advisors work in the future.
- 24% of advisors expect it will take 2-5 years to return to normal; 11% say it never will
- More flexible working styles are expected to continue
- Most advisors saw increases in clients during the pandemic
Changes in advisor routines
Probably the most dramatic change came in daily routines, with 71% of advisors saying the pandemic required them to work outside their normal office environment. Commuting to an office had been the default norm for virtually all financial advisors in pre-Covid days, but working from home became the new standard.
Perhaps unfamiliar at first, Zoom and similar tools soon made virtual gatherings commonplace. These new tools and other technology investments demonstrated that advisors and support staff could be just as productive working remotely as working in an office and it is likely they will continue to be used regularly.
Back to the workplace
Once restrictions are lifted, it’s likely many advisors will return to their firm’s offices. In fact, as our survey found, 70% expect they will return to the same office they left. But 20% said they expect to return to a downsized office and 10% said they won’t be returning and will continue to operate virtually. Indeed, many firms continue to weigh the cost of running an office against the results they’ve seen from operating virtually during the pandemic. And they know they’ll have choices of operating styles in the future.
20% of advisors said they expect to return to a downsized office; 10% said they won’t be returning and will continue to operate virtually.
A look at client growth
For most advisors, the pandemic was good for business. This came as a surprising benefit as 57% of advisors surveyed said they experienced an increase in the number of clients they served during the pandemic. And 62% saw an increase in assets under management.
The reason for this surge is multi-faceted:
- The panic that gripped markets at the start of the pandemic undoubtedly drove many fence-sitters to seek professional financial advice. Many others who previously had not sought guidance probably felt the need for outside expert counsel given the unusual times.
- The higher income segments of the population that are the typical clients of financial advisors found that they had more money to save and invest as the world shut down travel and other discretionary spending.
More so than income, advisor respondents said they valued being able to serve clients. Nearly 60% of advisors said what they liked most about the job was their ability to help and provide service to those that need it. And the pandemic certainly offered the opportunity for advisors to deepen client relationships through guidance and service.
Covid silver linings
The pandemic also produced other somewhat unexpected positives. More than half (51%) of advisors surveyed said the extra time with family was the most positive outcome of the pandemic. Nearly as many (46%) said it provided them with time to rethink their business and their role in it, and 39% said it provided them with a guilt-free reason not to see people. Roughly a third of advisors cited having a renewed sense of purpose in their job, time for personal pursuits, and a better work-life balance as positives.
A post-Covid normal
How long will it take to get back to “normal”? While 20% of respondents said business already has returned to normal, almost half (45%) said it would take a year or less, about one-quarter (24%) said two to five years, and 11% said things would never return to the way they were.
Given the changes that have taken place in advisors’ lives over the course of the pandemic—many of them positive—it’s likely this new “normal” will differ significantly from advisors’ pre-pandemic routines. Having experienced more time with family and more time to think about their business, advisors may be reluctant to leave those and other benefits behind.