Merrill Wealth Management, part of Bank of America, will keep its advisor payout grid unchanged in 2027 but raise the thresholds for growth awards and add a new incentive for client lending. The changes steer compensation toward bringing in assets and client households and arranging loans, as large wealth managers compete for advisor talent.
Merrill Chief Operating Officer Patricio Diaz said the firm reviews its compensation plans annually to support its long-term strategy and reward performance. This year's changes reflect evolving client needs and the range of services advisors can provide.
Base payout grid stays unchanged
Merrill is making modest changes to its advisor compensation policy for a second consecutive year. The percentage of annual revenue advisors receive under the base payout grid will not change in 2027.
Andrew Tasnady, founder of compensation consultancy Tasnady & Associates, said the overall impact is likely to be limited. Advisors whose business remains flat may notice little difference, while some near the eligibility thresholds could be affected. Advisors who grow their business are more likely to benefit from the incentives.
Compensation stability can also influence whether advisors move to another firm. A survey released this month by research firm Cerulli Associates found that advisors considering a move value plans that are both attractive and consistent. For large wealth managers, changing award targets can direct business priorities, while frequent changes to base compensation may unsettle advisors' expectations of the platform.
Merrill is the third large U.S. wirehouse to announce its 2027 compensation policy. UBS said its base payout grid would remain unchanged, while Morgan Stanley revised its grid, requiring advisors to generate more revenue to maintain the same take-home pay. Wells Fargo typically announces its compensation policy in October.
Under the current grids, a Merrill advisor generating $1 million in annual revenue can receive $465,000. That is more than a comparable Morgan Stanley advisor receives, but less than the payout at Wells Fargo or UBS. At $2 million in revenue, a Merrill advisor can receive slightly more than $1 million—still below Wells Fargo and UBS, but above Morgan Stanley. With Merrill's grid unchanged, its relative position across those revenue levels is expected to remain broadly the same.
Higher growth thresholds and three elite award paths
Starting in 2027, advisors will need to meet higher asset or household thresholds to qualify for Merrill's Growth Award. They must bring in at least $7.5 million in strategic flows, up from $5 million, or earn four points for new client households, up from three. Merrill generally awards one point for each new household, with larger households potentially counting for more.
The award applies to what Merrill calls “strategic flows,” which include assets in managed accounts, bank deposits and lending arrangements. Eligible advisors can receive an award of up to 12 basis points (0.12%) on the first $50 million of qualifying flows; the rate declines above that level.
Merrill will also replace its existing Elite Award, which was for advisors with more than $150 million in strategic flows, with three separate qualification routes: at least $50 million in net managed-account flows; at least $10 million in checking or savings account flows; or at least $10 million in total client loans arranged. Advisors who qualify for an Elite Award will receive a 50% increase to the additional portion of their Merrill Growth Award.
The new Loan Growth Award will pay according to total client lending arranged: 10 basis points (0.10%) for loans of at least $10 million, rising to 20 basis points at $25 million or more. Tasnady said firms sometimes adjust bonus structures to refocus advisors on priority business. Once advisors become accustomed to existing awards, smaller changes can keep those targets in view.
Client assets grow as advisor recruiting picks up
Merrill's recent results show growth in client assets and households. In the third quarter, total client balances at Merrill Wealth Management rose 9% year over year to $4.2 trillion. The figure includes investment assets, deposits and loans. The firm added 4,200 households with at least $500,000 in investable assets during the quarter, a 17% increase from a year earlier.
Merrill introduced the Growth Award in 2024, the same year it scrapped a growth compensation grid that had drawn advisor criticism. The old system paired awards with penalties for missing targets. Since then, the firm has generally avoided major compensation overhauls and instead used targeted adjustments to set business priorities. This year, Merrill reduced revenue credits for advisors serving “small” households with $250,000 to $500,000 in assets and loans. Advisors now receive credit for only 20% of the revenue those households generate.
Merrill and Bank of America are also stepping up advisor recruitment. Merrill Wealth Management co-head Lindsay Hans said on an earnings call last week that assets brought in by recruited advisors so far this year have exceeded twice last year's total. She said October was the strongest start to a fourth quarter since the firm resumed recruiting established advisors in 2024. Hans added that Merrill has several recruiting agreements in place and continues to retain senior advisors at a strong rate.
The 2027 plan therefore leaves base payouts intact while changing the targets tied to additional compensation: advisors must bring in more assets or households to qualify for the Growth Award, and the new lending incentive links awards to client loan volume.