Advice needed for next steps in PWM: MS/UBS/ML WM vs GS PWM as WMP?

Hey everyone! I've been a lurker in this forum for several years (especially of thebrofessor 's amazing PWM threads) , but figured it was time to ask for advice since I seem to be at a bit of a crossroads in my career. Would appreciate input from all backgrounds, but those from PWM would be especially helpful! 

I am currently a Registered CSA in my mid-20s at a traditional warehouse branch in a major Southeastern City (think MS/UBS/ML WM). I have about 5 years of experience under my belt between my internship and full-time role at the same WM firm. Current all-in comp is just under $70K/yr between my firm paid base, gross production %age, and discretionary bonus. Not allowed to work OT unless cleared through management (which is almost never). I started off with this firm as an Intern for a year before securing a full-time role upon completing undergrad in 2017 from a local non-target as a CSA. I got licensed with my 7 and my 66 within the year. There was projected to be a lot of growth on this team, as I worked on a team of four FAs with a Senior CSA, with two of the FAs in question retiring soon and selling their book to the ones who remained. I had a great relationship with everyone. Two of the FAs eventually retired and did sell their book to my current FAs, a transition that took about two years and grew the book to a little over $500mm AUM.  The Senior CSA abruptly, retired, and it was just the two FAs and myself. Over time, my current FAs began realize how big of a disconnect there was between their business model, mainly managed accounts/discretionary, with financial plans and paying fee, vs the book they inherited, which was full of mutual funds, and buy-and-hold transactional clients that do not like the idea of paying a fee, and smaller accounts than the $1mm-$5mm they like to target. We've been able to convert some of these accounts to fee paying clients and grow the business. The CFP FA is aggressively gathering new assets and other FA on the team is 72 and getting near retirement age. All fine and dandy, right? Hypothetically, there should've plenty of opportunity. I wish that was the case. This was hinted at but hasn't come to pass the way I envisioned.

I was given 0.50% of production after getting fully licensed in 2018, and that has not increased despite being the jack-of-all trades for my team and being a resource to other CSAs, including those more Senior than me, in the office. My days are usually 50% administrative or operational tasks/50% trading or helping create investment proposals since we're a small team headcount wise. I wish I knew back then that 1% was the industry standard. My FAs have said that as AUM and production grows, I will grow, and that someone needs to be hired under me to handle most of the admin work to receive a title promotion and to have the daily capacity to be more "involved" in the business. The problem is, they DO NOT want to pay for this new hire/help, and want the firm to pay for it. Understandable. But, the firm says no; they have to hit an $Xmm amount of annual production before the firm bear the cost of a new hire. My team has been very near this revenue goal, but hasn't crossed it. This tussle between team and firm has been on going for two years. I have tried to add additional value however I can, and even started studying to get insurance licensed but was told it would not help while I am in the CSA role, nor would it get me a bump in comp. I have been praised by my team and market management for being one of the best CSAs in the office, for having ambition to do more and for managing the transition of this legacy book of business as it hasn't been easy at all, but this hasn't translated to a promotion or increase in comp due to the desire to run lean.

I wasn't actively looking for a new opportunity, but was reached out to by recruiters from GS PWM and JPM PB, both looking to expand capacity in my area. Both are recruiting for new teams in the area. The role at JPM would be for a Private Banker Professional that helps service clients for multiple Private Bankers as a back-up banker and was more investment-oriented on the surface (trades and proposals). The GS role in particular would be as a Wealth Management Professional (WMP) based out of the local office GS, but serves all GS locations nationally as a floater during this rotation to help with capacity issues and to learn how different FAs run their book. After two years as a national floater for all GS offices, I could transition to a more traditional, local PWA-team oriented role. I thought this role was more Operational from my reading here, but gathered during interviews the WMP role at GS has become more of a hybrid/jack of all trades roles, and depending on the team I'd be supporting as a floater, may be more investment/trading oriented in addition to client service. This appeals to me as I still love speaking with clients. Becoming a Hybrid Associate/FA is my ultimate goal. I was recently offered the position at GS as an Associate-level WMP based on my years of experience. This came with a pay bump compared to the Analyst WMP title. Their offer was $90K/yr base, with expectations to work additionally paid OT each week and a yearly bonus. All-in comp would be easily over $100K/yr as a result. After two years in this new floater/rotational program, I could land with a team locally, potentially as a hybrid WMP or full-on FIP. I am ecstatic and gave my current team the heads-up, but they said they wanted to keep me and counter offered. They're offering to double my % of gross revenue share up to 1%, leaving me at around $80K plus discretionary bonus. They said to keep in mind the goal is to keep growing my % and the book, and they "meant to make me a 1% partner sooner", and that the older FA will soon retire and a merger will be complete sometime in the future that'll increase AUM near/up to $1B. I can bring in clients and get 50% of the revenue and have new splits set up with them so I can start handling some smaller, productive clients. But, no official title change out of the Registered CSA role will come until someone gets hired under me or until we merge and become a bigger team. I am very comfortable with my small team because it feels like family, I love my fellow co-workers, the clients etc. and I do see the opportunity for growth. I am essential to my current team since we're only three people total. But, all these plans are just that, plans with no set date as to when they'll happen (the merger has been on hold since COVID last year, older FAs retirement and all). It shouldn't be such a struggle with Management and my FAs to get a raise. If they gave me their 1% of gross offer back in December along with these general directional plans of eventually becoming a junior FA/partner working on their model portfolios, that would be enough. Everyone around me in the industry is saying to take GS PWM and run, even as a national floater WMP/part of a new desk. They think the salary and everything else that comes along with the GS PWM name is something I simply will not get at a traditional wire house branch, and that I was never going to get my raise if I never threatened to leave.

If you were in my position, would you go with the unknown? It does scare me a little bit that this GS WMP role is a rotational/floater role, and not with a specific team. But, it is also exciting to learn how PWAs both locally and around the nation service their clients and run their books. I am also making a jump in terms of the type of clientele I would be servicing- from HNW/some UHNW in my current role to exclusively UHNW families and institutions that have more complex financial needs and access to different strategies and alternative investments/Private Equity. Part of me feels bad that I would be leaving my team "high and dry" since the firm has not hired anyone under me to help. My "back up" is a full-time Senior CSA on a team equally as big as ours that we were thinking about merging with in the future (these discussions were going well but then COVID happened, and now we're more focused on AUM growth in the near term). Needless to say, my current firm runs lean. On the other hand, I have also thought that it's not my fault or my problem that they run so lean, and that they weren't prepared for me to leave, and they should've paid me more from the start. That I should take on this new journey at GS PWM in stride and get the higher paying role. Or, should I be waiting for JPM PB who's on a completely different recruiting timeline?

Any input is appreciated! I know this has been a very long read, but I needed to get this all off my chest. 5 years of frustration and lack of proper communication needs to be let out lol.

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Comments (8)

Feb 25, 2021 - 9:57am

oof, there's a lot there and you sound a lot like me in my mid 20s. lemme think on this and get back to you. the short answer is this - you've got a nice opportunity you're sitting on, but you gotta force the issue. what I ended up doing was basically saying "I want to enter the FA training program, will you support me?" to my team. my current team wouldn't (they later regretted it) and my now team would. it freed up headcount to hire another admin and it worked swimmingly.

also, I believe we're at the same firm and I have some firm-specific ideas on how comp works and all of that, so if you wanna move over to PM, you're welcome to. I will respond more fully later but wanted to throw that out there

Feb 26, 2021 - 9:24am

The WMP role at GS may just pigeonhole you even more in the CSA style role with a higher salary. If you really want to make the jump to an FA type role I would try to do everything I can internally first..before jumping firms. The salary bump would be nice, but make sure you haven't exercised all options to get into the trainee program. Eventually as an FA you'll be in charge of comp. If it doesn't work internally you can always apply to diff wirehouse trainee programs or GS NPWA.

Feb 28, 2021 - 9:29am

Thanks for your honest opinion. It's refreshing to see that there are in fact people here with experience in the industry! Personally, I don't know if I can survive a New FA program yet, let alone off of an eat-what-I-kill system. In the meantime, I was looking more for that hybrid investment/trading and client services role to get more exposure to the markets while still speaking directly to clients. This is what my current team has promised me, with the path to becoming jr partner in the future but hasn't exactly panned out over the years. This more structured role with GS sounded like it would fit the bill. They want to cross train this new WMP desk with skills from their FIPs and PWAs to fill in gaps where needed since this desk would be rotating to support teams on a national scale. In the long run, I do see myself as a junior FA/partner on a team maybe 3-5 years down the line. But, idk if that is now. I really thought I had this path with my current team up until now. An outside offer shouldn't be needed to seriously discuss a path forward and increase my supplemental comp. Is it really a partnership if I have to fight for it, and can it be salvaged? I am very worried about getting pigeon holed, though. People have told me to not worry, that having a new role/better title at GS in their system will be looked at in a different light than a Registered CSA for a WM/traditional brokerage firm, even if some of the functions are the same. But, idk how true that is. I have a lot to think about.

Feb 28, 2021 - 10:06am

30 yrs in PWM , financial advisory, distribution management, client facing the whole time. Have worked for companies (sales VP) and started my own shop, run hybrids, etc.

This may or may not resonate with you, but decide what long term position you want in the world of PWM. Essentially, there are two buckets: 1. Advisor (client facing, revenue producing, i.e. the Client Advisor) and, 2. Everything Else ( could be CSA, paraplanner, portfolio mgmt, etc. Lots of different roles but they all exist to serve the advisor / his her clients.)

Likely works differently at different firms, but at the end of the day, you're an advisor or something else. Do you want to run your own book, originate new clients, manage relationships, build a business? Or do you want to help someone else or several others do that? Comp will always favor the Advisors and it should as they are the ones bringing in business.

This is a personality issue and you need to be brutally honest with yourself. In terms of the advisor role: Can you do it? Do you want to do it? Would you thrive at doing it? Are you prepared for lumpy comp and lean times? Are you entrepreneurial? Are you a risk taker?  Do you require structure and like being guided or can you just figure it out on your own? If you check all those boxes, you could be an advisor. If you can't, it won't be a good fit so a support role would work far better. Nothing wrong with that.

I once had a CSA type guy working for me for several yrs. Was making decent money (salary, bonus, benefits) from my comp (100% fee / commission). He worked for me for 6 or 7 yrs. Several times he made noises about getting in the field, building a business, etc. He was somewhat taken back and shocked when I told him he can't. He basically responded by saying he didn't need my permission. I told him, "You misunderstand. Not about me letting you do that. That's not my decision. Can't means you can't. You would fail because it's not in you to be that guy. Not my rules, God's rules." Literally said that to him. He laughed, tried it and came back to working for me in a year with a completely different appreciation for what it takes to bring in clients. At the end of the day, all training programs and support systems aside, you either can or you can't.

Be honest with yourself and either go for a revenue generating spot, or understand you have a great future in serving those clients / advisors. It takes a team to manage a book.

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Feb 28, 2021 - 11:35am

Thank you for the honest feedback. This is exactly what I am asking myself since I am now at a fork in the road. You put it better than I ever could. The structure of certain firms allow for a productive career in various support roles with good compensation and such. Others don't and are very advisor/entrepreneurial driven, which also has it's benefits if that's what I end up wanting to do/can do. Currently going through not only the two choices in front of me, but what they mean for the future in terms of what I want to do and am best suited for.

Feb 28, 2021 - 1:47pm

Good to evaluate yourself and your options. Pragmatic. In the event this exercise leads you to the support functions, keep in mind you can do pretty well without all the glory. That is probably more shop centric then the advisor role which ultimately comes down to the advisor.

Have heard, don't know first hand, that portfolio mgmt type roles within the PB (BofA PB, JPM) do pretty well. Can get up to 250-400k at the most senior level. A lot of that is based on discretionary bonus determined by the MD/ Client Advisor. If the portfolio guy is making 250k, the Advisor is making 500+. 400k - advisor is making a mil.

In the independent world, essentially guys who set up their own RIAs or are IARS within the independent BD / RIA model, lots of advisors making seven figures and paying staff a good chunk. I know several that manage 100M-500M and bring in 1M-5M gross. The larger shops may have a support team of 10 including some CFAs to do modeling, portfolio construction, trading, etc. They also have folks that handle client engagement and provide white glove service. They are essential to  the advisor's ability to grow / succeed and get paid well. Maybe 150+ for the bigger shops. Becoming a junior partner with equity is another wealth building opportunity. Do the math. If a shop brings in 3M on 300M AUM (real numbers in the independent world - no haircut or very small like 5% max) non institutional (smaller margins), with a support staff of 7 paying a range of 50k-250k (role dependent). Let's say payroll is 750k (max) and office overhead / marketing is another 250k-500k, Advisor is netting 1.5M-2M pretax. Happens A LOT! And it's recurring so once the snowball is built, it's built.   Takes 15-20 yrs to build that. That can be your life. Grinding to get there but awesome once you're there (and fun along the way if you're the right type of person.) Or you can be one of those support folks who is well paid for playing a very necessary role.

The other thing to think about long term is corporate vs. Independent. Do you want the environment of JPM, GS, etc. or would you prefer an independent shop with it's own culture and rules?

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