RIAs Shift Pay to Cash as Growth Hits 10-Year Low

Consulting firm The Ensemble Practice and data partner ActiFi polled 173 independent registered investment advisory firms and other advisory practices between January and April 2026 and found a shift in compensation in 2025. Firms increased cash pay while restricting equity grants even though average profit margins across respondents reached 39% for the year.

The survey, published as “True Ensemble Data Insights: 2026 Careers & Compensation Survey Results,” reported organic growth of 3.7% in 2025, the weakest rate in a decade. Those two figures — high margins and low organic growth — coincide with higher base salaries and fewer equity awards across the sample.

Salary growth was uneven by role. Service advisors, who support lead advisors and add capacity, saw the fastest increases in salary and total compensation. Pay for CEOs and client service associates rose more slowly. The report noted that firms appear to be buying capacity with cash rather than expanding producer headcount through equity incentives.

Equity ownership remains concentrated at senior levels. Seventy-eight percent of CEOs reported holding equity in their firms, 53% of senior advisors reported ownership stakes, and just 14% of advisors one step below senior level reported equity.

The study documented differences tied to ownership structure. Firms with external owners tended to offer higher cash compensation, quicker promotion paths and higher advisor turnover. Advisor-owned firms tended to show slower advancement and used equity as the primary long-term incentive.

Operational metrics showed lower productivity per head: revenue per employee fell about 28% year over year. Practices added support staff faster than advisors. The main hiring points continued to be client service associates and associate advisors, and promotions at senior advisor levels outpaced new external hires. No role at any surveyed firm recorded turnover above 3.6% in the prior year.

Owners expressed caution about adding producer headcount without clear client inflows. Jeff Nash, CEO and co-founder of recruiting firm Bridgemark Strategies, cautioned: “Ultimately they’re going to lose value in their business is really what’s going to happen. One of the cautions that buyers are really aware of is firms that are no longer growing.”

The report identified two primary drivers of individual pay at advisory firms: equity ownership and revenue responsibilities. Revenue managed correlated most strongly with senior advisor compensation. The study noted that with equity becoming rarer and more expensive to issue, firms without available ownership stakes may increase cash pay to retain high-producing advisors. The report posed the question of how firms will balance pay, development and ownership going forward and noted that those choices could affect client capacity and future deal valuations.