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IBD Elite 2019: Top 10 firms with the fastest growing payouts

Financial advisors in the independent broker-dealer channel earned a combined payout of more than $15 billion in 2018.

As IBDs and their advisors aim to boost their productivity even higher, ten firms stand out from the rest of the sector in growing their respective average payouts by at least 20%. In fact, one firm’s average payout soared by more than 50% last year.

Compensation retained by advisors after deducting the varying fees they pay to the home office — depending on the product, service or other factors like their level of client assets — forms a key metric for the industry. It reflects both advisor productivity and firm payout rates.

A dozen of the 53 firms who participated in Financial Planning’s annual IBD Elite study didn’t include their total and average payouts. While the absence makes it impossible to calculate a sector-wide figure, the 41 other firms’ combined payout reached $14.73 billion in 2018.

The firms boosting their payouts the fastest haven’t approached the productivity level of Commonwealth Financial Network. The No. 4 IBD by annual revenue disclosed far and away the highest average payout per advisor in the sector for the fourth straight year at $557,000.

However, the ten smaller firms on the list with the fastest growing payouts are increasing them at notable rates. The drivers include some firms’ efforts to cut lower producers, firms’ home-office technology and support programs and the industry’s best year for revenue growth since 2014.

To view FP’s annual recap of the IBD space, “Time to celebrate? Not just yet,” click here. For a ranking of the top 10 firms by their proportion of fee-based revenue, click here. And to see last year’s list of top 10 fastest growing payouts among IBDs, click here.

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Securities America
2018 total revenue: $803,500,000
IBD Elite total revenue rank: #9
Producing representatives: 2,600
Total payout: $644,100,000
Average payout: $248,000
% change in payout year-over-year: 21.25%
% change rank: #10
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United Planners Financial Services
2018 total revenue: $131,918,000
IBD Elite total revenue rank: #36
Producing representatives: 418
Total payout: $114,769,000
Average payout: $275,000
% change in payout year-over-year: 22.62%
% change rank: #9
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ProEquities
2018 total revenue: $117,123,000
IBD Elite total revenue rank: #40
Producing representatives: 635
Total payout: $90,478,000
Average payout: $142,000
% change in payout year-over-year: 22.65%
% change rank: #8
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Woodbury Financial Services
2018 total revenue: $373,562,000
IBD Elite total revenue rank: #17
Producing representatives: 2,054
Total payout: $289,166,000
Average payout: $246,000
% change in payout year-over-year: 25.75%
% change rank: #7
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Hornor, Townsend & Kent
2018 total revenue: $124,165,000
IBD Elite total revenue rank: #38
Producing representatives: 841
Total payout: $97,500,000
Average payout: $116,000
% change in payout year-over-year: 25.99%
% change rank: #6
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FSC Securities
2018 total revenue: $305,578,000
IBD Elite total revenue rank: #24
Producing representatives: 856
Total payout: $247,254,000
Average payout: $289,000
% change in payout year-over-year: 26.25%
% change rank: #5
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O.N. Equity Sales
2018 total revenue: $77,097,000
IBD Elite total revenue rank: #45
Producing representatives: 633
Total payout: $66,295,000
Average payout: $105,000
% change in payout year-over-year: 27.39%
% change rank: #4
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Independent Financial Group
2018 total revenue: $174,208,000
IBD Elite total revenue rank: #29
Producing representatives: 540
Total payout: $148,783,000
Average payout: $276,000
% change in payout year-over-year: 30.63%
% change rank: #3
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MML Investors Services
2018 total revenue: $1,126,611,000
IBD Elite total revenue rank: #6
Producing representatives: 8,424
Total payout: $922,669,000
Average payout: $110,000
% change in payout year-over-year: 32.18%
% change rank: #2
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Waddell & Reed Financial Advisors
2018 total revenue: $522,794,000
IBD Elite total revenue rank: #14
Producing representatives: 1,060
Total payout: $321,638,000
Average payout: $303,000
% change in payout year-over-year: 50.42%
% change rank: #1