Wealth Management Salary guidance – how long is a piece of string?

Simon RoderickResearch, insights & industry news

Wealth Management recruitment - Fram Search

Wealth Management Salary guidance – how long is a piece of string?

Headline salaries don’t seem to have moved much since the credit crisis, which means a drop after inflation.
Wealth Management recruitment - Fram Search

Wealth Management has been on a tough journey since 2012. The industry survived the credit crisis well and rode the mini-Brown boom just after the crisis, but then in 2012 management time was consumed with RDR, and the equity markets were very volatile as commentators worried about Greece. Since then, the industry has been low-margin, relatively low growth, and there has been quite a lot of consolidation. However, we feel bullish on the sector for reasons we’ve outlined in our most recent article. Interestingly, headline salaries don’t seem to have moved much since the credit crisis, which means a drop after inflation.

However, as a leading recruiter in this field, we are often asked about salaries, but in truth it’s hard to be too precise as there are so many variables. It’s much easier to give guidance over a lawyer or accountant’s salary, as they tend to track their level of PQE and the type of firm they work for. Those in front line wealth management roles can see enormous variables. You can sometimes meet people from different firms who do the same role with a huge salary variance. The factors that affect salaries are:

  1. Who brings in the clients? The brand or the individual.
  2. The size of AuM managed
  3. The segment of the market you operate in – HNW vs UHNW
  4. Qualifications – albeit to a lesser extent
  5. Current earnings – rarely do people secure 50% pay rises when they move roles – even if the budget may be there.

With the above information, we can normally provide a reasonably precise guidance. Without it? How long is a piece of string?

In 2014, we wrote that salaries were the following:

Private Banker
AVP: £45K – £75K
VP: £75K – £110K
Director: £100K – £150K

Portfolio Manager
AVP: £45 – £65K
VP: £65K – £85K
Director: £85K – £110K

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Today, I’d adjust a Director within Portfolio Management to £90K – £150K, but again is depends on the book managed. Certainly, the industry has changed since headhunters could negotiate guaranteed and sign-on bonuses.

What would we recommend for those interested in increasing their earnings within wealth management?

It’s understandable that people want to maximise their earnings potential and we feel that in order to increase earnings wealth managers should consider either going up the risk scale, and joining a boutique and backing their ability to develop a book. We also think that moving into a financial adviser role can be far more lucrative longer term. Pay-outs are far higher and you always have the option of setting up your own adviser firm and of creating capital value. Buy-out values of adviser books are still very high and we feel competition will only increase in this area.

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