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Advisors are blissfully unaware of the risk inherent in their jobs.

The illusion of security

In the past few months, I’ve spoken to advisors and others who lost their positions due to cutbacks. They have a universal lament: They never thought it could happen to them.

Over a decade ago, I met a couple who both worked in the real estate division of Lehman Brothers. They wanted my thoughts on their 401(k) holdings. I asked them how they were invested. They told me they were 100% in Lehman stock.

I advised them to diversify their holdings. They declined my advice. One of them said, “You understand, Dan, we work for Lehman, right?”

Working for someone else provides the illusion of security. The reality can be quite different.

A loss of control

If you work for others, you should at least be aware of your risk.

The primary risk is loss of control. This is not a trivial issue. A belief that you’re in control of your life is associated with better health, wealth, wisdom, life satisfaction, optimism, cognitive performance (e.g., better memory or ability to pursue goals), and lower levels of depression and less functional limitations.

It’s difficult to have a feeling of control when your merit is judged by others. Their assessment may be influenced by their own biases (legal or otherwise). It can be arbitrary or inaccurate. Whatever motivates your supervisors in their evaluation of your work, one thing is perfectly clear: It’s largely beyond your control.