While setting clear career expectations should be a strategic priority for RIA firms, recent industry data suggests it's on a downtrend – and their business models could be to blame.
According to the latest DeVoe Talent & Growth Survey, 68% of next-gen professionals at RIAs say they want their firms to provide a well-defined career path. Yet only 38% believe their firms actually offer one – a sharp drop from 50% just a year earlier. More than half of respondents said they receive only informal guidance about advancement, while 8% reported little communication at all.
“Employees don’t need a promotion tomorrow. But they need to know the path to get promoted,” said David DeVoe, the M&A consultancy firm's eponymous founder and CEO. "If your best employees don’t see the path, you risk losing them entirely."
In a recent interview with InvestmentNews, Paige Earls, wealth manager at Crestwood Advisors, suggested that the decline in career pathing is a byproduct of continuing expansion across the RIA space. The most recent snapshot report by the Investment Adviser Association found that in 2024, the number of advisors at RIAs rose 3.1% year-on-year to reach 15,870, while the number of clients grew 7.1% to 68.4 million.
“The RIA space has just grown so rapidly over the years, and there are so many clients to serve,” said Earls, who manages a team of next-gen advisors at Crestwood Advisors. "Some companies can experience growing pains."
At many firms, the client service model involves one lead advisor overseeing a book of business, with multiple advisors providing support. While that can result in productive multi-tiered teams, Earls said it doesn't always come with a defined career path forward, and the reality can look different for each firm.
“It just depends on the structure. Some companies have it figured out and some could be more defined,” she said.
Matthew Cleary, a financial planner at Sentinel Group, argues that many larger firms adopt a “sink or swim model” in which new advisors hit the ground running with revenue or sales goals to meet.
“A lot of times, that doesn’t come with a whole lot of support necessarily, or a well-defined career path,” Cleary said.
The Schwab 2025 RIA Benchmarking Study paints a somewhat more optimistic picture, with 67% of firms at independent RIAs reporting they offer coaching or mentorships and 77% saying they provide career path or progression opportunities. Still, what next-gen advisors at large experience appears to fall short of that snapshot.
Earls, who estimates she sits down once a month with her direct reports at Crestwood, believes open communication and consistent feedback are critical to help new advisors feel engaged and see a future at their firms.
“It’s so important to make sure new advisors feel connected to their work and feel like they’re making a difference,” she said. “We’re sitting down individually, having conversations on things that are going really well, [and] things that are just individual challenges.”
Both Earls and Cleary agree that the rise of remote work and artificial intelligence has added complexity to the career development equation. Earls warned that while AI and virtual work setups can be a catalyst for growth if used properly, they can also become a hindrance if they displace real-world learning.
“If new advisors lean too heavily on AI for too long, they could miss out on real-life experience, which is really where professional growth comes from over their careers,” she said.
Cleary sees AI as a potential asset for younger advisors, provided they take the initiative to hone themselves as experts in new tools.
“It’s a huge opportunity for them to be able to master those skills and be an asset to their firm,” he said, emphasizing that technology cannot replace the need for human mentorship and hands-on experience.
Despite the challenges, both advisors see a path forward. Earls stressed the importance of mentorship – something the Omaha, Nebraska-based RIA Carson Group is addressing head-on with a program it launched just last week.
“Mentorship is one way we invest in those people and build the bridge between where advisors are today and where they’re capable of going," Burt White, CEO of Carson Group, said in the statement announcing its Carson Wealth Advisor Mentorship Program. "It helps strengthen confidence and capability, deepens our culture of collaboration and helps ensure continuity across generations of leadership."
“It doesn’t just have to come from a manager," Earls said. "It can come from a shared relationship with another colleague."
With a shortage of talent threatening to come for the industry within the next decade, Cleary urged firms to be explicit about what success looks like and how the next generation of advisors can progress.
“It makes a lot of sense to make sure we’re ramping up the next generation. It’s just embracing new technology and then being very explicit in the way that the job is defined and what success means,” he said.
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