Wells Fargo bumps up pay hurdle for advisors

For the first time in half a decade, Wells Fargo Advisors is bumping up a revenue and pay target known as a hurdle; below the target, advisors are paid less a percentage of revenue and above the target they are paid more. 

Over the same time, Wells Fargo Advisors has been refocusing the firm, bringing in a cadre of new executives and stressing its independent broker-dealer and registered investment advisor businesses in clear contrast to its wirehouse competitors. 

The last time Wells Fargo Advisors, which has roughly 12,000 financial advisors across its network, touched the hurdle for advisors who are wealth management employees was 2022.

That’s when the firm announced that the single monthly target of $13,500 was the benchmark for advisor pay.

Wells Fargo Advisors said last week the new month hurdle or target next year would be $16,000, an increase of 18.5%.

The rates of pay remain unchanged. The below-hurdle grid rate is 22%, or 22 cents per dollar of revenue. Revenue above that rate will generate a 50% grid rate, or 50 cents per dollar of revenue, for the advisor.

The S&P 500 has increased roughly by 65% since the start of 2022.

“We want to make sure our advisor compensation plan is aligned with our business strategy and that we are partners together,” said Sol Gindi, head of Wells Fargo Advisors, in an interview Monday afternoon. “This compensation plan is aligned with how our business and advisors’ businesses are growing.”

Advisors and teams that produce $2 million or more in annual fees and commissions will not be subject to the new pay hurdle and will receive a payout of 50%.

Meanwhile, in other large firm news from last week, UBS said it was continuing to watch a small percentage of advisors leave the firm.

For the quarter ending September 30, UBS last week reported 5,601 financial advisors in the Americas, compared to 5,779 the same time last year, a decline close to 3.1%.

It’s been a slow, steady drip of financial advisor attrition at UBS in the United States for several years. A change in some financial advisors’ compensation – announced at the end of 2024 and retracted less than a year later – didn’t help.

Such attrition is “normal,” according to one UBS executive.

“I think a degree of net attrition is probably the industry norm that you see as opposed to it being net flat, as a general premise over the long term,” said Todd Tuckner, chief financial officer, during a conference call last Wednesday to discuss third quarter earnings.

“So for us, it would be kind of normal net attrition levels that we've seen historically in our book and that we believe are aligned to industry levels,” Tuckner said. “That to us is what normal looks like.”

And Raymond James Financial Inc., which closes its fiscal year at the end of September, reported last Wednesday that over the past year it recruited financial advisors to its domestic independent contractor and employee channels with trailing 12-month production totaling $538 million and more than $82 billion of client assets at their previous firms.