Cheaper Ways to Lure Young Advisors
As demand for advisors continues to soar, advisory firms are grappling with how to attract - and compensate - the industry's next generation.
While the perceived talent shortage is causing rising levels of compensation across the board, we're seeing more emphasis on compensating young associate advisors and fostering career development, says Dan Inveen, principal and director of research for FAInsight, an industry consulting firm.
Median total compensation is now nearly $60,000 for support advisors and more than $80,000 for associate advisors, according to FA Insight's most recent salary study, People and Pay. A separate report, the Financial Planning Association's 2012-2013 compensation study, put median compensation for junior financial planners at $63,900 nationwide.
Firms had to pay nearly 10% more to hire new associates last year, according to Angie Herbers' Salary Advisor survey; she found total compensation rose to $71,250 for new junior-level hires.
But advisors grappling with hiring costs can take heart: Wooing and retaining young advisors goes beyond cash compensation, industry experts say. Younger workers are motivated by a variety of other factors, many of which require less upfront cash outlay.
Consider including some of these benefits in your recruiting pitch. -- Charles Paikert