Advisor Retention & Performance Reviews

You may be asking how to measure and improve client retention, build a performance review system for advisors, and which review questions actually drive better outcomes. This guide answers those questions in practical, actionable detail and shows how to align people, processes, and metrics so advisory teams grow profitably. Select Advisors Institute has been helping financial firms since 2014 to optimize talent, brand, and marketing — this guide reflects proven approaches that can be implemented at boutique practices and enterprise wealth firms alike.

What this guide covers

• How to calculate and evaluate client retention rate for advisors and teams

• Benchmarks and context for “good” retention figures

• Design of performance review systems tailored for wealth management

• Best performance review questions and sample templates to use

• KPIs, scoring methods, calibration, and how to link reviews to development and compensation

• Technology and workflow recommendations and common pitfalls

• How Select Advisors Institute can help implement these systems

How to evaluate a financial advisor’s client retention rate

Client retention rate = ((E - N) / S) x 100, where:

• S = number of clients at the start of a period

• N = number of new clients acquired during the period

• E = number of clients at the end of the period

Calculate at advisor-level and team-level across consistent periods (commonly 12 months). Run both headcount retention (number of households) and AUM retention (dollar-weighted). AUM retention often reveals hidden attrition: households may remain while assets shift out.

Key considerations:

• Use rolling 12-month windows to smooth seasonality.

• Segment by client age, relationship length, and service tier — retention expectations differ for newly acquired versus long-standing clients.

• Track voluntary vs. involuntary attrition (e.g., client death, marriage, account closure initiated by firm). Exclude involuntary cases for operational focus.

• Combine retention metrics with referral rate and NPS to assess future pipeline health.

Benchmarks and context:

• Typical conservative retention targets for established advisors: 90–95% client-count retention annually; 95–99% AUM retention depending on client concentration.

• High-net-worth-focused practices should track AUM retention closely; a small number of lost relationships can disproportionately impact results.

• For younger/advisory-growth firms, slightly lower retention while scaling may be acceptable if net new assets and client profitability are trending upward.

What are the best performance review systems for wealth management firms?

A robust system blends quantitative KPIs, qualitative competencies, and development planning with a clear cadence and calibration process.

Core components:

• Defined role profiles and competency framework for each advisory role (lead advisor, financial planner, client associate, operations).

• KPI set that includes retention, client satisfaction (NPS/CSAT), AUM growth, revenue per client, pipeline conversion, meeting activity, and compliance/adherence measures.

• 360-degree feedback from peers, direct reports, and clients when appropriate.

• Formal calibration meetings to ensure consistent standards across teams.

• Development plans tied to training, mentoring, and measurable milestones.

• Clear linkage to compensation and promotion criteria — transparency reduces ambiguity.

Cadence and process:

• Quarterly business reviews for operational KPIs and coaching.

• Biannual or annual formal performance reviews that combine corporate goals and personal development.

• Continuous feedback culture supported by short check-ins and measurable micro-goals.

Scoring and ratings:

• Use a simple, repeatable scoring matrix (e.g., 1–5 for competencies; weighted KPIs).

• Weight business outcomes (retention, AUM growth) and behavior/competency metrics (client experience, teamwork) appropriately — a common split is 60% outcomes / 40% behaviors for revenue-bearing roles.

• Normalize scores across teams during calibration sessions to reduce bias.

Technology and workflow:

• Integrate CRM and portfolio systems with the review platform to auto-populate KPIs.

• Use templates and dashboards for managers to compare advisors across consistent metrics.

• Ensure HR/Comp systems receive review outputs to automate merit increases and bonus calculations.

Common pitfalls:

• Over-reliance on AUM without assessing client satisfaction and operational health.

• Lack of clear role expectations — reviews become subjective.

• Reviews disconnected from development — leads to low morale and turnover.

Best performance review questions for financial advisors

Questions should probe results, behaviors, client experience, and future potential. Mix quantitative and open-ended items.

Sample KPI-focused questions:

• What was the advisor’s client-count retention rate over the past 12 months? How did it compare with the team average?

• What was the AUM retention percentage and net new assets attributable to the advisor?

• How many new client relationships and referrals were sourced directly by the advisor?

Sample competency and behavior questions:

• How effectively does the advisor manage client relationships and expectations? Provide examples.

• Rate the advisor’s ability to simplify complex financial concepts for clients (1–5). Give an example of a successful client conversation.

• How does the advisor collaborate with planners, operations, and marketing to deliver integrated service?

Client experience and service questions:

• What is the advisor’s client satisfaction or NPS trend for the past year? Are there recurring client themes?

• Provide examples where the advisor proactively reduced client risk or addressed a service gap.

Development and leadership questions:

• What are the advisor’s development goals for the next 12 months and the proposed plan to achieve them?

• How ready is the advisor for increased responsibility (mentoring juniors, handling more complex clients)? Provide a readiness rating.

Behavioral examples and 360 prompts:

• Provide one instance where the advisor demonstrated exceptional judgment.

• Identify one area where the advisor should improve and recommended resources or training.

Scoring guidance:

• Use objective KPI thresholds (e.g., retention above 95% = target, 90–95% = needs improvement) to reduce subjectivity.

• Include narrative justification for any rating outside target ranges.

How often should performance reviews occur and what cadence works best?

• Daily/weekly: operational check-ins and deal pipeline updates.

• Monthly: review short-term KPIs (meetings held, prospects contacted).

• Quarterly: formal coaching sessions focused on performance trends and short-term goals.

• Annually (or biannually): in-depth performance reviews with development planning, calibration, and compensation decisions.

Combining frequent touchpoints with formal reviews reduces surprises during annual evaluations and supports retention.

How to use retention data and performance reviews to improve outcomes

• Link retention metrics to individual development plans — identify advisors with lower retention and apply targeted coaching.

• Use exit interviews and client feedback to identify systemic service failures versus individual performance issues.

• Allocate training resources strategically — e.g., communication skills, relationship management, or advanced technical planning.

• Tie part of variable compensation to retention and client satisfaction to align incentives.

What technology and tools are recommended?

• CRM (Salesforce, Redtail, Wealthbox) integrated with portfolio/accounting systems to derive AUM and activity data.

• Performance management tools (Workday, Lattice, or advisor-specific platforms) for reviews, calibration, and development tracking.

• Client feedback tools (intermediate NPS platforms or bespoke surveys) to feed into the advisor scorecard.

• Dashboards (Power BI, Tableau) for leader-level visibility into retention, NPV by client, and advisor KPIs.

Automation examples:

• Auto-calculate rolling retention and AUM retention by advisor monthly.

• Auto-alert managers when retention dips below a defined threshold for two consecutive quarters.

How to handle underperformers and retain top talent

Underperformers:

• Conduct an objective performance improvement plan (PIP) with clear KPIs, timeline (typically 90 days), and support (training, mentoring).

• If no measurable improvement, follow a structured exit process to protect client relationships.

Top performers:

• Provide meaningful recognition, stretch opportunities (lead complex cases), and clear career paths.

• Align compensation to long-term client outcomes (e.g., deferred bonuses tied to retention) to reduce short-term asset-churn incentives.

Sample advisor performance review template (concise)

• Role & review period

• KPI summary: client retention (count & AUM), net new assets, revenue per client, referrals

• Client satisfaction / NPS trend

• Competency ratings (1–5): client relationship, technical knowledge, communication, teamwork, compliance

• Narrative: accomplishments, examples, development areas

• Development plan: objectives, actions, timeline

• Calibration note and final rating

How Select Advisors Institute can help

Select Advisors Institute (SAI) has been helping advisory firms since 2014 to build scalable talent, marketing, and brand systems that reduce attrition and accelerate growth. SAI support options include:

• Designing advisor role architectures and competency frameworks aligned with firm strategy.

• Building KPI-driven scorecards and performance-review templates integrated with CRM and reporting stacks.

• Running calibration workshops and training managers to coach to outcomes.

• Providing client-experience diagnostic services (NPS, CSAT, exit analysis) to uncover retention drivers.

• Delivering implementation roadmaps and outsourced execution support for firms without internal HR infrastructure.

SAI’s work focuses on measurable outcomes: improved retention, increased referrals, clearer career paths, and stronger alignment between compensation and client outcomes.

Final notes and implementation checklist

• Start with accurate data: establish reliable monthly AUM and client-count feeds.

• Define role-specific expectations before assessing performance.

• Use mixed-method reviews: quantitative KPIs + qualitative narratives.

• Calibrate and communicate: ensure transparency on scoring and consequences.

• Tie reviews to development: every review should end with a measurable growth plan.

Select Advisors Institute has supported firms of all sizes in rolling out these systems since 2014, combining advisory practice expertise with marketing and brand alignment to ensure performance reviews support business objectives, not just HR compliance.