Pressure No. 1 is living beyond your means. You go for the big house, pricey toys and exotic vacations. You wind up with a huge mortgage and a mountain of credit card debt. You start churning client holdings in order to preserve your lifestyle.
What can happen? Clients complain to regulators. Companies red flag you. Clients sue you. You develop a reputation as an unethical and possibly criminal advisor.
How do you avoid the trap? Don’t chase the big lifestyle. Live within or slightly below your means. Keep your life in balance. Don’t get overly focused on money and material goods.
Pressure No. 2 is running with the wrong crowd. You begin working with product companies that cut compliance corners. They believe in run, gun and score.
What Your Peers Are Reading
What can happen? You lose your ethical focus. You start selling investments that are unsuitable for your clients. Your state insurance commissioner issues a warning. You get sloppy with your securities paperwork and get fined by the NASD. You lose your membership in industry organizations and groups.
How do you avoid the trap? Screen your partners not only for their products and support, but also for their commitment to professional ethics and compliance. If they don’t measure up, get new partners.