Merrill to Boost Payouts for Retiring Advisors

The wirehouse is also restoring a fixed payout for so-called "active senior consultants," which Sieg says is "the only transition program in the industry" to do so.

The firm is also putting "a floor" on the CTP award percentage for those in the highest production level or longer-tenured than most peers. These percentages will be kept at the current level, though they can go higher "if performance improves."

Advisors "inheriting" the retiring reps' clients will continue to receive 50% payouts on this work. However, the new program will allow that payout to "continue until 80% of the CTP award is recovered," according to Sieg. 

"As a result, advisors who grow their practice will have the opportunity to shorten the recovery period, but the recovery period will be limited to a maximum of eight years. Regardless of the recovery period, the firm will subsidize 20% of the CTP payment," he explained.

Finally, advisors going into the new program will not be asked to sign any additional documentation or contracts. Specifically, no "garden leave" provisions will be required. Such policies typically affect advisors leaving a firm, who are paid but do not work in an office and are not bringing in new clients.

Sieg added, "By deferring until November 2021, we're giving you the time to carefully consider your options and decide when the time is right for you."

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