How Much Do Money Managers Make: A Comprehensive Guide

As a money manager, your salary can vary greatly depending on your experience, location, and type of clients you work with. According to the article, the median salary for a money manager in the United States is around $80,000 per year.

To give you a better idea, here are some specific salary ranges for different types of money managers: Portfolio managers can earn anywhere from $100,000 to over $200,000 per year, while financial advisors may earn between $50,000 and $150,000 per year.

One thing to keep in mind is that money managers who work in the financial industry, such as investment banks and hedge funds, tend to earn more than those who work in private practice or as independent financial advisors.

A unique perspective: Manager Quiz

Money managers provide money management services to clients for a fee. They can create a customized portfolio of investments for each client or maintain a set fund that clients can buy into.

The type of compensation for money managers can vary, with some charging a one-time fee or a periodic one. Others charge a commission-based fee, which can be up to 20% of profits.

A common fee structure is the 2 and 20, where a 2% fixed fee of the assets under management is paid, and 20% of profits are paid as a commission. This fee structure is more common in large-scale money management.

Money managers can provide customized portfolios or maintain a set fund for clients, with the former being more common in retail banking and the latter in large-scale money management.

Compensation for money managers can vary, with some charging a one-time or periodic fee, while others charge a commission-based fee, such as 20% of profits.

Money managers often charge a fixed fee and a variable fee, with a common fee structure being the 2 and 20, where 2% of assets under management are paid as a fixed fee and 20% of profits are paid as a commission.

This fee structure may increase the incentives of a money manager to maximize returns for the investor, potentially decreasing moral hazard.

Wealth management is a specialized field that requires a strong foundation in finance and client relations. Wealth managers work closely with affluent clients to help grow, manage, and preserve their wealth based on their unique goals and situations.

Wealth managers can start their careers in entry-level positions like financial advisor associates, supporting lead advisors while learning the intricacies of the job. After 3-5 years, they typically progress into wealth manager positions with direct client responsibilities.

A wealth manager's salary can vary substantially based on factors like years of experience, firm type, geographic location, investment performance, and professional credentials. Many wealth managers pursue professional credentials like the CFP, CFA, and/or CPA to command higher compensation from firms and clients alike.

Entry-level wealth managers typically start with salaries ranging from $50,000 to $75,000, with those having finance or accounting degrees earning slightly higher starting salaries. Key factors that impact entry-level pay include education level and field of study, internship experience, financial certifications, and performance on skills assessments.

Additional reading: What Is a Manager

Here's a rough breakdown of the typical career path for a wealth manager:

Keep in mind that these salary ranges are estimates, and actual salaries can vary depending on individual circumstances.

Wealth manager compensation can vary widely based on factors like experience, firm type, and location. Wealth managers at top Wall Street brokerages and wirehouses typically earn the highest salaries, with base salaries starting around $100,000 and total compensation ranging from $250,000 to over $1 million annually for top performers.

Base salaries for wealth managers at regional independent firms can range from $60,000 to $150,000, with total compensation reaching $150,000 to $500,000. The payout structure at these firms incentivizes advisors to grow their book of business and cross-sell value-added services.

Here's a breakdown of median hourly and annual salaries for financial managers:

Keep in mind that these figures are medians, and actual salaries can vary widely depending on the specific role and location.

A money manager is essentially a person or entity that handles the financial assets of a portfolio for individuals or institutional investors. They track expenses and investments, create budgets, and evaluate taxes.

Money managers can have various goals for their clients, such as ensuring the safety of the principal or maximizing returns. They have a fiduciary responsibility to choose investments with their client's best interest in mind and without taking on unwarranted risks.

Money managers often have access to areas of the capital markets that clients may not have, or they may have access to these areas at a cheaper premium. This can be beneficial for clients who may not have the resources or expertise to navigate these markets on their own.

Some famous money managers include Warren Buffet, Charlie Munger, and Peter Lynch, who have achieved great success in managing investments for their clients.

Wealth managers at top Wall Street brokerages and wirehouses typically earn the highest salaries in the industry, with base salaries starting around $100,000 for junior roles and exceeding $300,000 for senior positions.

Regional broker-dealers and independent brokerage firms offer competitive wealth manager salaries, with base pay ranging from around $60,000 to $150,000 and total comp with bonuses often $150,000 to $500,000.

Large national firms like Morgan Stanley, Merrill Lynch, and UBS provide some of the most lucrative wealth management career paths due to their scale, brand recognition, and access to elite clients.

Here's a breakdown of wealth manager salaries by firm type:

Financial advisor fees can vary widely, depending on the level of service provided, geographic location, and other factors. A typical fee range for assets under management (AUM) is 0.25% to 0.50% annually for a robo-advisor, and 1% for a traditional in-person financial advisor.

Robo-advisors and online financial planning services often charge AUM fees, while traditional human financial advisors may charge a flat annual fee, hourly fee, per-plan fee, or commission. The median AUM fee among human advisors is about 1% of assets managed per year.

There are different types of financial advisors, including robo-advisors, online financial planning services, and traditional human financial advisors. A fee-only advisor doesn't earn any commissions from investments, a fee-based advisor charges a fee but may also accept commissions, and a commission-only advisor earns their income from commissions on investments.

Some financial advisors charge a fixed fee, while others charge a commission-based fee, such as 20% of profits. A common fee structure is the 2 and 20, where a 2% fixed fee of the assets under management are paid and 20% of profits are also paid as a commission.

Here are some typical fee ranges for financial advisors:

Keep in mind that these are just general guidelines, and the actual cost of working with a financial advisor may vary depending on your specific needs and circumstances.

Money managers charge a variety of fees, including a one-time fee or a periodic one, a commission-based fee, or a fixed and variable fee structure.

Some money managers charge a 2% fixed fee on assets under management, while others charge a 20% commission on profits.

A common fee structure is the 2 and 20, where a 2% fixed fee is paid and 20% of profits are paid as a commission.

This fee structure can incentivize money managers to maximize returns and reduce moral hazard.

Advisor fees can be complex and vary widely depending on the level of service provided, your geographic area, and other factors.

Typical fee structures include assets under management (AUM), flat annual fees, hourly fees, per-plan fees, and commissions. AUM fees range from 0.25% to 0.50% annually for a robo-advisor and 1% for a traditional in-person financial advisor.

Some advisors charge a flat annual fee, which can range from $2,000 to $7,500. Hourly fees typically cost between $200 to $400. Per-plan fees range from $1,000 to $3,000.

Commissions on investment transactions can range from 3% to 6% of the transaction amount.

The cost of working with a financial advisor can be difficult to determine due to the variety of fee structures and certifications used. However, it's essential to understand exactly how much you'll pay for services and what those services entail.

A robo-advisor will typically charge an AUM fee of 0.25% to 0.50%, which works out to $125 to $250 a year on a $50,000 account balance. Some robo-advisors charge no management fee at all.

A set monthly or annual fee, also known as a retainer, is another common fee structure. This cost is usually not linked to how much you have available to invest, but you may pay more if your situation is complex. The cost of a retainer typically ranges from $2,000 to $7,500 a year.

You can expect to pay a one-time fee or periodic fees for money managers who only charge either a one-time fee or a periodic one. Some money managers charge a commission-based fee, such as 20% of profits. However, more commonly, money managers charge either a fixed fee and a variable fee.

Here's a breakdown of typical commission fees:

It's essential to understand the fee structure and what you're paying for before hiring a financial advisor.

The wealth management industry has seen significant growth in recent years, driven by a rise in high net worth individuals (HNWIs) globally, with HNWI wealth surpassing $80 trillion in 2021.

This increase in wealth is fueling strong demand for wealth managers to help HNWIs manage their finances. The industry is expected to see steady growth in the years ahead, which bodes well for wealth manager salaries.

Baby boomers are transferring trillions in wealth to younger generations over the coming decade, presenting major opportunities for the wealth management sector. This generational transfer of wealth will likely lead to more individuals seeking professional wealth management to preserve and grow their newfound assets.

By 2032, the number of jobs for financial managers in the United States is expected to increase by 21.8%, with about 169,104 jobs added over the next 10-year period.

The wealth management industry is experiencing significant growth, driven by a rise in high net worth individuals (HNWIs) globally.

HNWIs' wealth has surpassed $80 trillion in 2021, up nearly 10% from the previous year, according to Capgemini's 2022 World Wealth Report.

This increase in wealth is fueling strong demand for wealth managers to help HNWIs manage their finances.

As more individuals inherit wealth, they will likely seek professional wealth management to preserve and grow their newfound assets.

Baby boomers are transferring trillions in wealth to younger generations over the coming decade, presenting major opportunities for the wealth management sector.

Analysts project steady growth for the wealth management industry in the years ahead, boding well for wealth manager salaries.

Advertised salaries for financial managers have increased 12% over the past three years, based on compensation data in job postings dating back to September 2019.

Financial managers can expect a 12% increase in advertised salaries over the past three years. This trend suggests a growing demand for skilled financial professionals.

Job growth for financial managers is also on the rise, with a projected 21.8% increase in jobs over the next 10 years. This means more opportunities for those entering the field.

Wealth manager salaries are expected to rise by 15-20% on average through 2030, making it a lucrative long-term career choice. This growth is driven by the increasing wealth circulation globally and investors seeking professional management.

Entry-level wealth managers can expect more modest salary growth around 10%, while senior-level advisors may see even higher increases approaching 25-30%. These projections indicate a promising future for those in the wealth management industry.

There are approximately 774,302 positions for financial managers in the United States. This number is based on data from 2022.

The national median salary for financial managers was reported to be $139,797. This figure is a significant amount, and it's no wonder that financial management is a highly sought-after career.

Employers across the country posted 266,368 job postings related to positions for financial managers. This high demand for financial managers is a testament to the importance of their role in the business world.

The median hourly salary for open positions for financial managers in the United States is about $57. This figure is based on 36% of postings with advertised compensation.

Geographic differences play a significant role in determining wealth manager salaries. Major financial hubs tend to offer higher pay, while secondary markets may pay less.

Wealth managers in New York City can expect to earn significantly more than those in smaller cities. Major financial hubs like San Francisco and Los Angeles also offer high salaries.

In contrast, secondary markets like Chicago and Dallas may pay 20-30% less than major hubs. This difference is due to the concentration of high-paying clients and firms in these cities.

Wealth managers in major cities often have access to more clients and higher-paying opportunities. This can lead to higher earning potential for those in these locations.

The San Francisco Bay Area is a global financial hub that rivals New York. Salaries for wealth managers in this region are significantly high, ranging from $200,000 to $450,000+ per year.

High salaries are driven by the region's high costs and concentration of tech wealth. This necessitates higher pay to compensate for the area's expensive living costs.

The influx of new wealth from the technology sector is a major factor in the demand for wealth management services. This has created a lucrative market for wealth managers in the Bay Area.

High cost of living necessitating higher pay is a key consideration for wealth managers in the Bay Area. If you're looking to boost your earning potential, this region is definitely worth considering.

Here are some key statistics to keep in mind:

There were about 774,302 positions for financial managers in the United States in 2022. This number gives us a sense of the scope of the job market for financial managers.

Employers across the country posted 266,368 job postings related to positions for financial managers in 2022. This indicates a strong demand for financial managers in the job market.

The median hourly salary for open positions for financial managers in the United States is about $57, based on 36% of postings with advertised compensation. This is a key figure to consider for anyone thinking about pursuing a career as a financial manager.

Advertised salaries for financial managers have increased 12% over the past three years, according to compensation data included in job postings dating back to September 2019. This trend suggests that financial managers are in high demand and their salaries are rising accordingly.

The job market for financial professionals is looking bright, especially for those in the wealth management sector. Financial managers can expect a 21.8% increase in jobs over the next 10 years, with approximately 169,104 new positions added.

This growth is largely driven by the rise of high net worth individuals, whose wealth has surpassed $80 trillion globally. As more individuals inherit wealth, they'll seek professional wealth management to preserve and grow their assets.

With the wealth management industry expected to see steady growth, wealth manager salaries will likely rise in response to increasing demand for their services.