Are advice firms overlooking incentive schemes?

Business Health recently conducted research with almost 100 advice practices to better understand what salaries and benefits packages advisory firms were offering their staff in an “already overheated” marketplace. 

Noting the importance of attracting and retaining the best available talent as a key to long-term business success, the report aimed to raise important questions and concerns about the employee marketplace “to build a high-quality, sustainable and profitable advice profession.”

Benefits and bonuses

Per the survey, over 40% of firms did not offer any type of incentive or bonus scheme to staff.

Of the firms that did offer these packages, 37% stated that their plan was not open to every employee in the firm. 

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Moreover, 29% of firms did not offer support staff the option to negotiate flexible working hours. This was coupled with 78% who did not offer paid maternity or paternity leave to support staff.  

The report observed, “While offering a competitive financial package to employees and potential new team members is a great start, this alone may not be enough to attract and retain the talent needed to build and grow the successful advisory businesses of the future.”

“Without a change to their stance on [these] benefit options, it will become increasingly difficult for these practices to remain competitive in a hot marketplace.”

It recommended advisory firms review what they were offering employers, particularly support staff and administrators, to align with the changing expectations of today’s workforce. 

Remuneration

Topping the list, an adviser with more than five years’ experience earned an average salary of just under $150,000, including superannuation. The average bonus payment for this group was $11,519, however this figure varied based on practice size. 

Junior advisers, or advisers with less than five years experience, earned an average of $97,872 with a bonus payment of $7,414. However, only 42% of the firms actually employed junior or less experienced advisers.

General or practice managers came in second with a salary of nearly $130,000 but a lower bonus payment of $5,609.

For professional support, they could expect to earn $115,188 on average alongside a $3,375 bonus.

Paraplanners with over five years’ experience were making $107,075, compared to paraplanners with less than five years’ experience who earned $74,127. The former could see a bonus of $2,826, with the latter receiving a $2,481 bonus. 

The average salary of client service managers sat at just over $75,000, with a bonus of $1,767. 

For administrative or receptionist roles, their earnings were $58,207 on average, alongside a bonus of just over $1,000.

The figures revealed by Business Health were noticeably higher than previous reports conducted on the earnings of an adviser. 

Recruitment  

Three quarters of the firms surveyed expressed future plans to hire at least one staff member in the next 12 months.

The most sought-after role by firms was client service managers, with 50% of both city and regional firms looking to fill this position.  

Regional firms were keenly eyeing out junior advisers, with 67% of these practices actively recruiting this group, compared to 39% of city firms seeking junior advisers. 

For firms to attract and retain quality staff, Business Health suggested advice firms conduct remuneration reviews, proactively promote employee value proposition (EVP), and undertake annual staff satisfaction surveys.

It also advocated for firms to view remuneration as an investment, not an expense, and reconsider their ancillary benefits in a competitive employee marketplace.