Financial Planners & Investment Advisors NAICS 523940

Mar 21, 2025 - Annual Bonus Packages Go Up

• Portfolio management and investment advisor wages for nonsupervisory employees increased 3.4% year over year in January 2025 (per the US Bureau of Labor Statistics) as bonus packages became more generous than they were in 2022-23. Bonus pools are critical compensation elements to investment bankers and account for a significant portion of total compensation. The overall bonus pool spiked to $42.7 billion in 2021 (per the New York State Comptroller) before it course-corrected to more standard levels. The bonus pool was estimated to grow 7% in 2024 to around $36.1 billion. A recent survey of investment banker pay by recruiter Prospect Park Partners found junior associates with a starting salary of $110K can earn up to 50% of base salary in bonuses. At the VP and up level, bankers can earn bonuses equal to or higher than their base salary, with the average bonus being $1.7 million.
• About 96% of investment advisors’ clients asked questions about cryptocurrency in 2024, up from 88% the prior year, according to Investopedia. Increasing bitcoin prices driven by demand for spot bitcoin ETFs in the early part of the year and the outcome of the US presidential election may have boosted interest in cryptocurrency. About 14% of financial planners are suggesting crypto investments to their clients. Many experts advise clients against investing in cryptocurrency due to its high volatility.

• A significant portion of advisors who responded to a recent J.D. Power survey said that they might leave their firm in the near future. Among advisors who are more than two years away from retirement, 34% who work in an employee channel and 41% of those who are independent said that they might jump to another firm in the next year or two. Investment advisory firms will have to work harder to retain top talent, according to J.D. Power.
• The most commonly cited investment goals of people surveyed by consumer research firm Hearts & Wallets were not directly about investing. Forty-eight percent pointed to building an emergency fund, followed by 43% who said they wanted advisors to help them plan financially for a vacation. Behind those goals were having enough money to work less when older (39%) and being able to stop work fully in retirement (32%). People cited investing goals such as generating current income, capital preservation and capital appreciation about as much as they said they wanted financial planning around buying a new car or buying real estate, at more than 20%.