What would you like to know
- Morgan Stanley is making some minimal adjustments to advisor incentives in 2022.
- Starting in July, the net growth in acquired assets will be based on all customer balances.
- Starting in the third quarter, net assets acquired and assets under management of Morgan Stanley clients who also have E-Trade accounts will be included.
Morgan Stanley is keeping the basic payout schedule for its roughly 16,000 advisers and brokers intact for 2022, but making some adjustments to incentives, according to the new plan that was leaked internally by the company on Wednesday.
“In keeping with our strategic goals, the plan is designed to help you develop your practices and deepen your relationships with clients,” said Vince Lumia, head of field management, advisors and brokers at the firm in a note.
“The minimum updates to the plan are aligned with our modern wealth management strategy and aim to better position you as your businesses evolve to meet the unique needs of your clients,” he explained. .
The company reiterated that it is “agnostic” about where assets are held. With that in mind, starting in July, the net growth in acquired assets will focus on all customer balances (net acquired assets plus net growth in new liabilities), he revealed. Currently, it only includes fresh money (the equity side of the balance sheet).
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In addition, starting in the third quarter, net assets acquired and assets under management of Morgan Stanley clients who also have E-Trade accounts will also be included. (This applies to self-directed accounts where clients have granted advisor visibility to their E-Trade accounts.) Morgan Stanley acquired E-Trade in 2020.
Meanwhile, after introducing new customer engagement criteria required for team compensation in 2021, the company continues to build on those customer engagement metrics in 2022 by adding a fourth way to qualify, offering more Qualifying flexibility for teams that keep or constantly add new assets and liabilities to their books.