Slowing revenue growth in advice business will impact career development

The rate of growth in the industry is important because it defines the rate at which firms can develop the careers of their employees

Oct 17, 2017 @ 5:00 pm

By Liz Skinner

Advisory firm growth has been in decline for three years and the dangers of that extend beyond smaller budgets and lower business valuations. Slower growth threatens the advisers' personal development, according to one industry expert.

The rate of growth in the industry is important because it defines the rate at which firms can develop the careers of their employees, said Philip Palaveev, CEO of The Ensemble Group, at the InvestmentNews Best Practices Workshop in Boston on Tuesday.

"Each person is looking to grow — grow their income, their responsibilities, their careers, and their intellectual capabilities," he said. "But if the firm is not growing, there is really no room to grow and their careers slow down."

The median revenue growth for advisory firms was about 5% last year, down from 8% in 2015, 14% in 2014, and 16% in 2013, Mr. Palaveev said in presenting the findings of the 2017 InvestmentNewsAdviser Compensation & Staffing Study. The research was sponsored by Pershing Advisor Solutions.

(More:Advice firms in a tricky financial position)

Some firms are growing faster than others, of course, and InvestmentNews recognized 21 firms on Tuesday with 2017 Best Practices Awards.

These firms rank among the top quartile of more than 700 independent advisory firms that participated in the 2017 Adviser Compensation and Staffing Study and the 2017 Adviser Technology Study. The businesses range in size but have one feature in common.

"Their leaders have a clear plan and vision for growing their firms and managing elite organizations," said Mark Bruno, associate publisher at InvestmentNews and head of InvestmentNews Research.

A dozen firms were recognized for their growth and profitability and were identified as having superior compensation and staffing practices: ACG Wealth, Accredited Investors Wealth Management, CJM Wealth Advisers, Dowling & Yahnke Wealth Management, EisnerAmper Wealth Management & Corporate Benefits, Foster & Motley, JMG Financial Group, Johnson Investment Counsel, Private Vista, Roof Advisory Group, Sage Financial Group and Wacker Wealth Partners.

Nine firms were acknowledged for their technology practices: Asset Management Group, Balasa Dinverno Foltz, Center for Financial Planning, Etesian Wealth Advisors, Fierston Financial Group, Nvest Financial Group, Sensible Financial Planning and Management, Strategic Wealth Management Group, and The Burney Company (Burney Company Investment Management).

(More:Highest paying jobs at advisory firms)

Yonhee Gordon, principal and chief operating officer of JMG Financial, attributes her firm's success to its focus on a career path for all of its 50 employees and supportive salaries and benefits.

"There's a huge investment that we put into our people," she said.

0
Comments

What do you think?

View comments

Recommended for you

RIA Data Center

Use InvestmentNews' RIA Data Center to filter and find key information on over 1,400 fee-only registered investment advisory firms.

Rank RIAs by

Featured video

Events

4 secrets to adviser growth; Financial planning

Growing your practice can be difficult, but advisers you aren’t alone. Growth is hard for everyone. John Anderson and Raef Lee of SEI talk about how financial planning can help take your practice from good to great.

Latest news & opinion

Midwestern magic? RIA assets soared nearly 30% there last year

Theories for what's driving the growth spurt abound, but it surpassed all other regions of the country.

8 apps advisers love for getting stuff done

We reached out to advisers to find out which apps they are using to run their business more efficiently.

10 tax moves to squeeze in before the year ends

Here are some tax moves clients can still make before year-end.

Richard Neal: the new face driving retirement policy in Washington

As he becomes head of the House Ways and Means Committee, Rep. Richard Neal (D-Mass.) is poised to make some big changes.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print