UBS has recently disclosed its 2024 advisor compensation plan, which includes a new bonus addition, as stated in an internal memo obtained by 's. The plan, designed with input from advisors, continues to prioritize rewarding productivity, growth, and longevity.

Consistency in Pay Grid

Notably, UBS has decided to uphold its pay grid system, which serves as the foundation for its advisor compensation plans. This means that as advisors generate higher levels of revenue, they will progress through the grid and receive increased compensation. This typically consists of a combination of cash and deferred compensation.

Enhancements for Advisors

In a positive development for advisors, UBS (ticker: UBS) will be adjusting the balance by increasing the cash portion offered to those who generate annual revenue ranging from $750,000 to $3,000,000. This modification is likely to be well-received among advisors who prefer a higher upfront cash component in their compensation.

UBS Introduces New Client Growth Award

UBS, one of the nation's largest wealth management firms, has recently announced the introduction of a new client growth award. This award aims to recognize and reward advisors who excel in generating positive net new business and cultivating valuable client relationships.

Advisors Eligible for Reward

To qualify for this award, advisors must meet specific criteria. They will be awarded 1% of their compensable 12-month trailing production as of December 2024. In order to earn this bonus, advisors must demonstrate the ability to generate positive net new business between November 1, 2023, and December 31, 2024. Net new business is defined as new money and lending.

Additionally, advisors must establish at least two qualified new client relationships during this timeframe. These relationships should have a minimum of $1 million in assets. By focusing on these targets, advisors can position themselves for this exciting opportunity.

Emphasizing Client Cash Balances

In addition to the client growth award, UBS has introduced new compensation incentives for advisors. These incentives aim to motivate advisors to prioritize banking and other services with their clients.

Under the 2024 plan, advisors have the potential to earn 10 basis points of monthly production credits on eligible client cash balances. These eligible balances include sweeps, savings, and money market funds. It is important to note that the compensation is capped at a maximum of $5 million per household.

To be eligible for this compensation, households must deposit a minimum of $5,000 per month or complete at least five qualifying transactions per month. These transactions may include check deposits and bill-payments, among others. By encouraging clients to engage in these activities, advisors can unlock the potential for increased compensation.

Recognition and Opportunity

UBS's annual compensation plan not only provides financial rewards but also serves as a testament to the company's commitment to supporting and recognizing their advisors. With over 6,000 advisors in its Americas unit, UBS continues to invest in the success and growth of its team.

As the third wirehouse to unveil its annual compensation plan, UBS solidifies its position as a leader in the industry. With its focus on client growth and commitment to providing value-added services, UBS positions itself as a trusted partner for both advisors and clients alike.

Morgan Stanley and Merrill Lynch Reveal Their 2024 Plans

By Andrew Welsch

In separate presentations held in September and October, leading financial institutions Morgan Stanley and Merrill Lynch unveiled their ambitious plans for 2024. Notably, Morgan Stanley (MS) announced a significant increase in compensation grid thresholds, which is expected to impact advisors' payouts.

Compensation Changes at Morgan Stanley

As part of its plan to drive growth and enhance profitability, Morgan Stanley is raising the bar for its advisors. The firm has increased the compensation grid thresholds by approximately 10%. While this move may require advisors to generate more revenue, it aims to ensure the sustainability of payouts in the long run.

Merrill Lynch's Vision for 2024

Merrill Lynch has also shared its vision for the future. However, specific details regarding compensation changes have not been disclosed at this time. Nevertheless, the firm's advisors can anticipate a transformative period ahead as Merrill Lynch strives to innovate and adapt to evolving market dynamics.

While both firms have exciting plans on the horizon, it's essential for advisors to stay informed and prepared for potential adjustments that may impact their financial performance. The industry's landscape continues to evolve, and adaptability will be key to thrive in the ever-changing market.

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