According to the U.S. Bureau of Labor Statistics, the median annual wage for personal financial advisors was $94,170 in May 2021. It means half of the financial advisors earned more than that, and half earned less. One in ten earned less than $47,570, while one in ten made more than $208,000.
It is not uncommon for advisors with 20+ years of experience to make well over $500k per year. I personally know of several who make $1+ million. That kind of personal income is across the board: wirehouse or independent. Many times this can be more when managing a team of advisors.
In our professional experience, achieving an annual income of $300,000 is a realistic target for financial advisors, particularly when leveraging a combination of fee structures, effective AUM growth strategies, and commission-based earnings.
Achieving a seven-figure income as a financial advisor is possible but not typical. Adhering to industry regulations and ethics is crucial while striving for high income.
While a 1% annual fee may seem like a small price to pay for professional investment guidance and financial planning, it can significantly erode portfolio returns over long time horizons. Even seemingly minor differences in fees add up in a big way when compounded year after year for decades.
In addition, millionaires are much more likely to work with a financial advisor (69%), more than double the amount of the general population (33%).
Your financial advisor generally receives between 36% and 40% of the revenue Edward Jones receives from asset- based fees, transactional revenue, ongoing 12b-1 fees, trail commissions, and revenue from premiums generated by activity in your accounts.
Financial service providers regard a HNW client as someone with at least $1 million in liquid – or investable – financial assets. Clients with assets between $5 and $30 million are considered VHNW, while UHNW clients have assets greater than $30 million.
The highest salaries for financial planners are in Connecticut, Maine, Rhode Island, New York and New Jersey. States such as the District of Columbia, Florida and North Carolina offer high salaries for financial advisors because of the large number and high concentration of financial companies in these states.
Commissions. In this type of fee arrangement, a financial advisor makes their money from commissions. Advisors earn these fees when they recommend and sell specific financial products, such as mutual funds or annuities, to a client. These are often payable in addition to the above client fees.
Edward Jones. "Edward Jones Ranks Highest in Investor Satisfaction, According to J.D. Power 2021 U.S. Full-Service Investor Satisfaction Study."
They will first need to earn a bachelor's degree in accounting, business management, finance or a closely related field. Applicants looking to further enhance their qualifications should consider a master's degree in accounting, attainable online.
Millionaires don't worry about FDIC insurance. Their money is held in their name and not the name of the custodial private bank. Other millionaires have safe deposit boxes full of cash denominated in many different currencies.
Around 60%, or the majority, of financial advisors with more than five years of experience will earn over $100,000 annually and up to $300,000. At the higher end, $300,000, puts the advisor in the top 10% of household income in the United States, which is not bad at all.
On average, you can expect to pay between 0.5% and 2% of your total assets under management annually, $150 to $400 per hour, or a flat fee ranging from $1,000 to $3,000 for a comprehensive financial plan.
It depends on who you ask but a typical answer is anywhere from 50 to 150 clients per advisor. Having 50 clients could be enough if you're focusing on high-net-worth individuals.
Very generally, having between $50,000 and $500,000 of liquid assets to invest can be a good point to start looking at hiring a financial advisor. Some advisors have minimum asset thresholds. This could be a relatively low figure, like $25,000, but it could also be higher, such as $500,000, $1 million or even more.
Large Companies (Revenue over $500 million)
CFOs in such companies typically see salaries ranging from $350,000 to over $1 million annually, not including substantial performance-related bonuses and stock options.
Some advisors may see commissions as high as 70% of the first year's premium. After that, they may receive an additional 3% to 5% of the premium per year as long as the policy is active. Mutual funds: Typically, advisors making commissions on mutual funds get paid via a trailer fee.