Registered investment advisory firms waging a fight for top financial advisor talent are netting a healthy return on their payroll investments. But that may not last through the next downturn.
This year, RIAs are going through “a period of high profitability but very slow organic growth,” which means that advisors who can deliver new clients or deeper relationships with existing ones will find that “many organizations are willing to pay a premium” for them, according to consulting firm The Ensemble Practice’s annual compensation survey. The three top tiers of RIA advisors netted 10% or higher bumps in base salary for 2025, the poll of more than 200 advisory firms found. As shown in the five charts below, however, even their total compensation is a small expense in comparison with the revenue they’re generating for their firms.
Results from the survey released last month indicate that the prosperity and record size of RIAs may be hiding some signs of strain beneath the rising stock values of recent years. Discussions of advisor compensation frequently show up around the constantly tweaked pay grids of wirehouses and regional firms. Now the rapid expansion of RIAs has brought more such conversations to the forefront of the independent channels of the industry. Addressing the lack of organic growth has emerged as a crucial goal with any RIA compensation structure, according to Mike Byrnes, founder of RIA growth strategy firm Byrnes Consulting.
“I’ve seen that they’ve really been riding the tailwind of the market growth, and a lot of the success from the growth side has come from the markets,” Byrnes said. “Unfortunately we all know that will end. That’s something that I think a lot of firms should be afraid of, that they’ve gotten kind of dependent on the markets’ success.”
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Give everyone a stake in the goals
That’s why experts like Byrnes say it’s crucial for RIAs to align their pay to organic metrics — and not just those of advisors. Marketing directors, business development officers and service and operations staff who play technical roles ensuring sufficient capacity for expansion should all reap rewards for hitting their respective job targets, he said. That starts with advisors, though.
“The advisors, who are currently the stewards of client relationships, are also participating in the success of their firms through their access to equity and the profits of the firm,” the report said. “Advice is a team sport, and compensation for advisory firms should reflect that approach. A good firm will find a way to share the profits and value created with those who put their careers and reputations at stake every day.”
Those types of incentives point to the need for “a concrete strategy that will deliver results,” encouraging advisors “to be outside the walls, to really be developing strong human relationships” while delegating and using technology to maximize efficiency, Byrnes said. Sometimes that requires regular reminders of an RIA’s progress toward larger objectives.
“Imagine an advisor’s got a full load of meetings in a week and they get pulled in 100 different directions — if they don’t step out of that daily rigamarole, they’re going to lose focus on what their main goals or what their initiatives are,” he said. “Sometimes advisors can’t get out of their own way. They can’t let go of things an intern can do. … The ones who are really better at growth delegate in a more successful way.”
Scroll down the page for five charts on the current levels and structure of RIA compensation. For analysis of The Ensemble Practice’s other annual report on RIA business metrics, click here. To view coverage of another report tracking the size of RIAs, follow this link.
Note: All statistics below come from last month’s annual RIA pay report by The Ensemble Practice, “True Ensemble Data Insights: 2025 Careers & Compensation Survey Results.” The consulting firm and data partner ActiFi polled 230 RIAs and other advisory firms on their businesses between late March and early May this year.
In tracking the compensation of advisors, the report broke them down into four categories: associate advisor (entry level 1, with alternate titles of paraplanner, analyst, senior analyst, planning associate or wealth advisor associate); service advisor (level 2, with alternate titles of support advisor or, in some cases, a higher tier of associate advisor); advisor (level 3, with alternate titles of lead advisor, financial advisor, investment advisor, wealth manager, financial planner and wealth advisor); and senior advisor (level 4, with alternate titles of partner, managing director and senior wealth advisor). The firm assigned other positions like CEO, chief operating officer, president, director of marketing and portfolio manager to separate categories.
The salary pecking order
In 2025, advisors (15%), service advisors (11%) and senior advisors (10%) netted double-digit increases in their base pay, while the salary of CEOs at RIAs ticked up by less than 1%. The rising compensation for all levels of advisors reflects “the high demand for the profession,” according to the report. “Executive leaders, whose expertise unites the firm’s capabilities, are also in demand and being well rewarded for their impact. Recruiting throughout the industry remains active and dynamic, but most firms rely primarily on talent development rather than purchasing skills in the open market. For all positions, internal promotions vastly exceed the number of current employees hired from the outside.”
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How big is your book?
A median revenue of more than $1.1 million “represents a very promising ‘building block’ for a firm and creates a foundation for profitability,” the report said. “Note that the median senior advisor compensation represents less than 20% of the revenue managed. This allows the firm to surround the advisor with ample resources and still maintain very high profitability.”
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Total compensation of senior advisors
When including their expected salary and other forms of compensation for 2025, senior advisors will collect a median of $270,000. When considering the “very high productivity of advisors and the profound impact they have on growth and profitability,” their equity in their RIA “makes their participation in the value of the firm very desirable and perhaps badly needed,” the report said. And that begs the question of, “Would those advisor/owners be willing to work for the same firm for the same compensation if they were not owners? As many firms transition to institutional ownership where advisors are not owners, the salary and bonus expectations may change.”
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Advisor career paths
For those just below the senior level of RIA advisors, the median tenure in the field is a decade, and the potential for a promotion to the next step amounts to “a key consideration for the position,” the report said. “Typically, firms require business development efforts and notable results to make that promotion. As a result, many professionals remain in the Advisor role, reluctant or unable to ‘bring clients to the firm.’ Still, with the emergent success of marketing-driven growth strategies at the firm level — rather than sales at the advisor level — firms may be willing to ‘waive’ the business development requirement in an effort to attract the most productive advisors.”
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Heavy is the crown
The top post “is the most highly-compensated position within advisory firms, reflecting their responsibility for the overall performance of the organization,” the report said. “CEOs are held to the highest standards, both in expectations and compensation design. While many firms have traditionally drawn their CEOs from among their owner/advisors, an increasing number are now recruiting external business executives with prior experience leading advisory firms.”
