Advisors employed by investment firms are increasingly dissatisfied with their pay, according to a J.D. Power survey released Wednesday.
Exactly half of firm-hired advisors said they had pay cuts in the last year compared to 41 percent in 2014, the report said, adding 9 percent of those advisors saw their pay plans improve in the latest survey.
The cuts were worse for individual advisors controlling $150 million or more in assets than professionals with less than $50 million in assets under management.
The reductions could hurt the firms in the long run, warned Michael Foy, Power’s wealth management practice director.
“Firms can’t afford to rely solely on short-term retention tactics like contracts and deferred compensation to retain [their most successful] advisors. While there is no evidence of an imminent mass exodus of financial advisors from their firms, we know that when advisors decide to leave their firm, they tend to take most of their clients and assets with them,” Foy said.
The study found women advisors tend to be happier at firms than male counterparts, and younger advisors are more content than their older co-workers.
Edward Jones had the highest advisor employee satisfaction rank with 925 points out of 1000, while Morgan Stanley Wealth Management brought up the rear with 611. Charles Schwab advisors gave the firm 785 points, Wells Fargo Advisors received a score of 701 and Bank of America’s Merrill Lynch received 645.