New FA Insight benchmarking research from TD Ameritrade Institutional finds the leadership of registered investment adviser firms (RIAs) is getting younger — passing the torch from the Baby Boomer to Gen X — and investing to sustain their firms’ strong performance well into the future.
The report found that the advisory community as a whole is getting younger, reversing a graying trend that had many advisers worried about the sustainability of the industry. With a median age of 49 years — three years younger than in 2015 — six out of 10 firms have at least one owner who expects to stay at the helm for at least another 12 years, according to The 2019 FA Insight Study of Advisory Firms: People and Pay.
The median age of firm associates, overall, dropped to 42 from 44 in 2015, while the median age of lead advisers is now 46 years, down from 50. The study also found that the number of owners who are 40 years of age or younger equals the number of firm owners who are over 60.
“As the next generation of RIA leaders comes to the forefront, they’re investing in their firms with a long time horizon,” said Vanessa Oligino, director of business performance solutions at TD Ameritrade Institutional. “We expect to see different approaches to industry challenges — whether they be staffing and compensation, growth and organizational design, or technology and innovation.”
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