The annual wirehouse payout tweaking ritual has begun. Morgan Stanley kicked off the festivities this week by announcing that its 2015 grid will boost the amount of broker compensation that the firm defers. Deferred stock awards will vest in four years, deferred cash will vest in eight. Details to follow shortly.
Major wirehouses typically re-jigger compensation starting right around Thanksgiving and continue until year’s end. The idea is to clip just enough to add to the firm’s bottom line, but not so much as to prompt advisors to leave.
Does deferring more of an advisor’s compensation constitute a payout cut? Here’s what I told Fund Fire:
Ultimately, “when you pay people less now, and more later, it’s a type of a payout cut, even if it’s not an adjustment on the grid,” Elzweig says.
We should be hearing from some of the other wirehouses shortly.