As the U.S. wealth management industry enters 2025, it does so from a position of strength. Demand for financial advisory services continues to rise, driven by increasing individual wealth and more complex financial needs. Americans are relying more on personal savings for retirement, and sophisticated financial products are becoming essential for wealth accumulation and preservation. Clients are also showing a growing willingness to pay for expert, human-delivered advice.

However, the industry faces a pressing challenge: a looming shortage of financial advisors. Current trends suggest that, by 2034, the sector could see a deficit of approximately 100,000 advisors. This potential gap raises concerns about how firms will continue to meet the rising demand for financial planning and wealth management services.

Increasing Demand for Financial Advice

Over the past decade, financial advisory services have been the primary driver of industry growth. Revenue from fee-based advisory relationships has surged, growing from roughly $150 billion in 2015 to $260 billion in 2024. Moreover, the number of individuals seeking human-advised relationships has outpaced overall population growth. Looking ahead, the number of such relationships is expected to increase significantly, reaching between 67 million and 71 million by 2034—a 28% to 34% rise from 2024 levels.

The Declining Advisor Workforce

Despite strong demand, the advisor workforce has not kept pace. Over the last decade, the number of financial advisors has grown at an anemic rate of 0.3% per year. Worse still, projections indicate an annual decline of 0.2% moving forward. The industry is aging, with many advisors nearing retirement. By 2034, approximately 110,000 advisors—38% of the current workforce—are expected to retire, leaving firms scrambling to fill the gap.

Without significant changes, the industry faces a severe workforce shortage, with the number of available advisors falling short by as much as 37% of current levels. To counteract this, firms must rethink their approach to recruitment, training, and overall productivity.

Solutions to Bridge the Advisor Gap

Addressing this challenge requires a multi-faceted approach, including recruitment of new talent and enhancing productivity through teaming and specialization.

Enhancing Productivity Through Teaming and Specialization

Advisors working in teams that include specialists in trust administration, estate planning, and tax strategy tend to be more productive. These team-based models optimize skill allocation, improve career pathways, and enhance client service quality. By integrating trust specialists into advisory teams, firms can ensure seamless wealth transfer planning and reduce administrative burdens on advisors.

Currently, advisors in team settings manage portfolios that are, on average, 20% larger than those of solo practitioners. Expanding the team-based approach across the industry, especially with dedicated trust professionals, can unlock additional capacity and improve efficiency.

How Independent Trust Company (ITC) Can Help

As firms work to bridge the advisor gap and improve productivity, Independent Trust Company (ITC) offers solutions that support both advisors and their clients. ITC provides expert trustee services, allowing financial advisors to focus on investment strategy and client relationships while ITC manages the complexities of trust administration. Our team ensures that trust management, compliance, and fiduciary responsibilities are handled with precision, reducing the operational burden on financial advisors.

By partnering with ITC, wealth management firms can enhance their service offerings, improve efficiency, and ensure that clients receive the best possible financial guidance—despite the industry’s ongoing workforce challenges.

*Source of Data: The looming advisor shortage in US wealth management, McKinsey and Company: https://www.mckinsey.com/industries/financial-services/our-insights/the-looming-advisor-shortage-in-us-wealth-management