For female advisors, the study found statistically significant factors related to income were experience, role, team structure, work hours, revenue and psychological motivators. Having 20 to 30 years of experience was positive. Being an associate advisor or an executive (both compared with a lead advisor) was a negative. Working in an ensemble firm, when compared to working as a solo advisor with support, was positively associated with income. Higher work hours and higher revenue also led to more income. Being less motivated by work-life balance also led to more income.
The study participants were mostly male (82.25%), married (89.30%), CFPs (72.68%), and working as a lead advisor (72.25%), and most had 10 or more years of experience (57.43%). The largest percentage of advisors in the sample worked at ensemble firms (46.20%).
“Speaking only for myself,” said Tharp, “I do hope that these findings may be encouraging to women who may have been discouraged from pursuing a career in financial planning due to the large gender pay gap among financial advisors commonly referenced in the media. I can certainly understand why anyone would feel discouraged from entering a profession if they felt that they would not receive equal pay for equal work.”
The study will be discussed during a session at the Financial Planning Association’s annual conference in October.
The other author on the study was Meghaan Lurtz of Kansas State University.