A study shows advisors' incomes are rising, despite the financial markets.

It may seem hard to believe, but advisors are happier with their careers and are making more money than in the heady days of the bull market, according to a new survey by the College for Financial Planning.

"I think there's no doubt it's been challenging for advisors in light of the bear market. Advisors are receiving more calls from clients who are seeing retirement accounts and investment accounts go down, but at the same time, I think the reason satisfaction is going up is that advisors are needed more than ever," comments Jesse Arman, the college's vice president of academic affairs.

The college's "2002 Survey of Trends in Financial Planning" found that an overwhelming 98% of respondents were either satisfied (24%) or very satisfied (74%) with their professional work. Planners reported higher satisfaction with the client-related aspects of their careers than business-related aspects. Further, planners find people and communication skills to be the No. 1 reason for their continued success.

The study also found planners are earning more money. The 2002 respondents reported a 67% increase since 1998, from $60,000 to $100,000, in annual individual gross earnings after receiving the CFP certification. Planners with more years practicing in the industry reported higher gross and net earnings. In the 2002 survey, the median combined gross earnings for the most recent fiscal year from financial plan writing, product sales, consulting and related activities was $200,000, an 82% increase over the $110,000 reported in 1998. The median net earnings reported in 2002 were $120,000, an increase of 60% over 1998 figures. Of the respondents who charge hourly, the median hourly rate was $150.

Why earnings rose so significantly is difficult to quantify, Arman says. For one, the percentage of respondents with 13 or more years of financial services experience rose dramatically, to 79% in 2002 from 47% in 1998. Also, four years ago, fewer people were calling themselves financial advisors, Arman notes. "You have a lot of individuals coming into the profession from accounting, insurance and law. They have a client base, an earnings base and an experience base. They may have been doing accounting for 15 years, but more recently became a CFP," he says.

The Denver-based college invited more than 2,500 people to participate in the survey. They were randomly selected from a list of 17,279 Financial Planning Association members having CFP certification. The number of people who completed and returned valid responses to the 2002 survey was 247, a number judged to be satisfactory for describing and comparing their opinions and experiences.

In its 1994 and 1998 surveys, only graduates of the college's CFP education program were polled. The college broadened the survey population to provide a more accurate picture of the industry. The change also recognizes the growing number of schools offering CFP programs. In the past four years, the number of programs registered with the CFP Board of Standards has more than doubled to 234 programs offered by 151 educational institutions, the survey notes.

About 78% of the respondents were male. The gender split of all FPA members is 75% male and 25% female. The 45- to 54-year-old age group had the highest representation in the survey, with 44.1% of responses coming from that group. It was followed by the 55- to 64-year-olds, at 24.9%.

Other major findings of the survey follow.


First « 1 2 3 » Next