Raymond James & Associates is introducing a new compensation plan this year for employee advisors that company officials claim is more simplified and product-neutral and sweetens advisors’ commission ratio scale.
The new plan takes effect in October 2013 for existing advisors and immediately for any advisors joining the firm after January 14, 2013.
“After several years of soliciting feedback from advisors, studying the market and giving careful consideration to timing, we are implementing a new payout grid for implementation in fiscal year 2014,” said Tash Elwyn, president of Raymond James & Associates Private Client Group.
Elwyn says James' new plan offers more latitude to its employee advisors than other companies' plans do.
“Unlike our competitors, there are no plan dictates on account size; there are no incentives for specific products or lending, or any minimum monthly commission hurdles,” Elwyn added. “However, the plan is similar to our old grid in that it continues to sit on a single sheet of paper.”
The new plan mainly provides a financial incentive for advisors by increasing the number of tiers in the company's commission payout scale from five to 15, effectively reducing the amount of commissions an advisor needs to generate before climbing to the next commission payout tier.
Commission payout percentages range from 20 percent on the first tier for gross commissions of $200,000 to 50 percent on the 15th tier for gross commissions over $5 million.
The payout schedule applies only to financial advisors with at least seven years' industry service. Payouts for advisors with less than seven years are determined by their divisional director.
St. Petersburg, Fla.-based Raymond James & Associates is the traditional employee broker/dealer of Raymond James Financial Inc.