There are a lot of things in life in which getting to a “no” is easier than getting to a “yes.” Deciding which RIA to join is one of them. With several strong value propositions in the marketplace to choose from, determining which one to say yes to takes time. The easiest way to begin the process is to narrow the field by knowing which solutions you should quickly say “no” to. In this episode of the Transition To RIA question & answer series I explain which type of RIAs you should exclude fr...
Jan 04, 2024•30 min
Ideally you will never be in a situation where you must ask what is the quickest you could transition your practice to the RIA model. A transition typically involves a methodical, well thought out process. But there are some circumstances where an expedited transition might be necessary. In this episode I explain when those circumstances might occur, and how quickly you can make a change if needed. Come take a listen! P.S. Prefer video? You can find this entire series in video format on Youtube....
Dec 12, 2023•25 min
You don’t choose which car to buy based on which dealership brand happens to be closest to where you live. You don’t choose which house to buy based on which listing you happen to see first on Zillow. The tail should never wag the dog. Important decisions should be made based on the underlying variables, not based on which decision is logistically easier to make. The same thing applies when picking what type of firm to transition your practice to. In this episode, I explain why choosing a broker...
Nov 28, 2023•23 min
There are many participants in our industry who run around gleefully messaging the big upfront bonus checks wirehouses are known to write. Have you ever considered why that is their opening line? As they say in Texas, are they “big hat, no cattle?” Before considering taking a big upfront check for joining a firm, it is important to understand the trade-offs you’re forced to take in return. In this episode of the Transition To RIA question & answer series I explain what those trade-offs are, ...
Nov 06, 2023•27 min
There are no specific regulatory or legal definitions of "Corporate RIA" or "Independent RIA." Instead, we must rely on how the terms are commonly used in the marketplace. Corporate RIA verbiage is most often used in reference to the RIA component of large broker/dealers, particularly independent broker/dealers. Independent RIA verbiage is typically used in reference to owning your own RIA. On this episode, I discuss not only these two definitions, but additional ways in which the verbiage is us...
Oct 24, 2023•17 min
You've done your due diligence on the RIA model. You've determined which path into the model to use. You've mapped out the transition steps. But how much is it going to cost to make the transition? There are hard costs, as well as your own peace of mind, that must be considered. In this episode I explain what those costs are and how to plan for them. Come take a listen! P.S. Prefer video? You can find this entire series in video format on Youtube. Search for the TRANSITION TO RIA channel. Show n...
Oct 05, 2023•27 min
Transitioning your practice to an existing RIA platform is a path chosen by many advisors. An important part of your due diligence of a firm is their payout. In this episode I explain how payouts in the RIA model are generally structured, as well as the payout levels you can expect depending on the type of solution you choose to partner with. Come take a listen! P.S. Prefer video? You can find this entire series in video format on Youtube. Search for the TRANSITION TO RIA channel. Show notes: ht...
Sep 19, 2023•30 min
Transitioning your practice to the RIA model gives you the luxury of creating your own brand. Having a website to showcase your brand, and provide a way for clients and prospective clients to find you, is an important part of it. On this episode I cover the logistical and creative considerations involved with acquiring a domain name (i.e. the ".com" part) for your new website. Seven tips covered in the episode: Use a “.com” domain. Chose a domain that is either your brand name, or descriptive of...
Aug 29, 2023•22 min
Many advisors seek to transition their practice to the RIA model by joining an existing RIA offering. With different platform types, value propositions, and economic considerations, how do you choose the one that is the best fit for your practice? On this episode of the Transition To RIA question and answer series, I am joined by Penny Phillips, cofounder of Journey Strategic Wealth, to discuss how to evaluate an RIA to join. We cover not only the variables you’ll want to understand and consider...
Aug 08, 2023•48 min
Determining whether to transition your practice to the RIA model does not have to be intimidating. The entire process can be simplified down to three key decisions, sequentially addressed in order: Is the RIA model a fit for my practice? What are the available pathways into the model? Who are the solution providers that support my chosen pathway? In this episode of the Transition To RIA question & answer series I explain how these three decisions guide you through the process. Come take a li...
Jul 25, 2023•26 min
If you transition your practice to the RIA model there are a LOT of variables to consider, and decisions to be made. What technology to use is one of the most important of them. Within the technology "stack," your Customer Relationship Management ("CRM") tool is arguably the most important component. In this episode of the Transition To RIA question & answer series I explain why the CRM is so important, and how you should consider implementing it with your practice. Come take a listen! P.S. ...
Jul 06, 2023•26 min
There are multiple tasks involved with running an RIA practice. Advisors tend to be passionate about the client facing tasks, and less so the behind-the-scenes administrative and operational parts. What if you designed an RIA where you outsourced most (all?) of the non-client facing tasks? What if you could spend nearly all your time on just the parts of the business you really enjoy? In this episode I explore how far you can potentially take outsourcing within an RIA. Come take a listen! P.S. P...
Jun 22, 2023•24 min
You've done your homework to learn how the RIA model works. You've considered the different pathways into the model. You've performed due diligence on the needed solution providers. It all makes sense. It's a fit for your practice. You're ready to get started! But, is there anything that could prevent you from doing so? Yes, there are hurdles that, depending on your circumstances, could be insurmountable. In this episode of the Transition To RIA question & answer series I explain what those ...
May 25, 2023•21 min
How much does it cost to start a Registered Investment Advisor ("RIA") practice? As often occurs with the advice that financial advisors give their own clients, the answer is "it depends." For new advisors first entering the industry who plan to run a virtual practice, the cost might be as little as a few thousand dollars. For a large team catering to HNW clients, who plan to transition their practice from an existing broker/dealer firm, the cost could potentially be $100,000+. There are several...
May 10, 2023•26 min
Obtaining Errors & Omissions ("E&O") insurance for your Registered Investment Advisor ("RIA") is not only a best practice, it is usually now a requirement for most RIAs. E&O is professional liability insurance that protects your RIA from risks ranging from the proverbial "fat-fingered" trade entry error, to defending yourself against meritless lawsuits. Most custodians now require RIAs using their clearing services to maintain a minimum level of E&O coverage. In this episode I ex...
Apr 27, 2023•18 min
A common frustration by financial advisors in the broker/dealer model is a burdensome compliance department. This is often the result of the firm managing compliance to the lowest common denominator amongst thousands of advisors at the firm. An inaccurate assumption about the RIA model is that joining an RIA with similar growth aspirations will lead to a compliance burden no better than what the advisor is trying to get away from at their broker/dealer. In this episode, I explain why this is a f...
Apr 11, 2023•29 min
A tale often told by broker/dealer management is that B/D technology is superior to the technology available in the Registered Investment Advisor ("RIA") model. A few decades ago, they were right! There was a time that broker/dealers had better economies of scale with technology investments as they had more advisors (users) to spread the investment cost across, versus what any one tech provider in the then RIA space could achieve. That investment advantage, led to better technology. That paradig...
Mar 23, 2023•25 min
It is common for advisors transitioning their practice to the RIA model to want to bring their existing support team members with them. Those team members are often not only critical to the advisor's practice in general, but will likely play a key role in the transition process itself. In this episode of the Transition To RIA question & answer series, I am joined by attorney Rich Chen to discuss what options you have for bringing team members with you, and how to navigate the process safely....
Mar 08, 2023•34 min
There are many advantages for why financial advisors transition their practices to the Registered Investment Advisor ("RIA") model. Equally compelling are the advantages for their clients. It is important to be able to articulate to your clients what the RIA model is, why you are transitioning your practice to it, and how it benefits them. I frequently ask advisors that have already made the transition, how they explained it. In this episode I provide several talking points to consider, and I sh...
Feb 23, 2023•28 min
"Can I manage client assets myself as an RIA?" This is a simple question, with a simple answer. “Yes” More telling is why advisors are asking it in the first place. It is often due to concern that their ability to manage assets under their current affiliation model could become constrained, or even taken away from them at some point in the future. (Of no fault of their own, but due to firm wide policy changes.) Thus, they're wanting to confirm this possibility would be eliminated if they transit...
Feb 07, 2023•20 min
Episode notes: The Registered Investment Advisor ("RIA") model remains the fastest growing channel in the industry, with no indication the trend will slow anytime soon. Year after year, financial advisors seek out the better economics, flexibility, and higher enterprise valuations afforded by the model. With such advantages, why don’t even more advisors (than already are) make the transition with their practices? In this episode of the Transition To RIA question & answer series, I address th...
Jan 19, 2023•27 min
There are many misconceptions about the RIA model. You can’t take your legacy commission business with you…..false. You’ll spend all your time on compliance…..false. You can’t use alternative investments…..false. The technology is inferior…..false. I could go on and on. In this episode of the Transition To RIA question & answer series, I address another falsehood: You can’t accommodate clients who have concentrated stock positions. You can indeed. Come take a listen! Show notes: https://Tran...
Jan 04, 2023•18 min
Imagine I challenged you to a one-on-one game of basketball. We each use the same equipment. The rules of basketball apply to both of us. One caveat: You must play with one arm tied behind your back. Sound fair? Or an unfair advantage? If such a scenario seems preposterous, consider if you’re currently a one-armed player as an advisor. The Registered Investment Advisor ("RIA") model provides financial advisors an advantage over advisors not in the model. In this episode I explain 13 of those adv...
Dec 13, 2022•28 min
Want to know the dirty little secret of real estate expense for advisory practices? You need to pay for the expense of your office as a fixed cost, not a variable cost via your payout. The difference in approaches, particularly if you own your office building, could potentially result in millions of additional dollars to your net worth by the time you retire. In this episode I discuss why and how to pay for office expense as a fixed cost, as well as additional ways you can decrease the expense e...
Nov 21, 2022•23 min
What is a corporate RIA? You're possibly already affiliated with one and don't realize it. Worse, you could be affiliated, and don't realize if it's even competitive or not. As the trend to fee-based advisory relationships continues, the concept of a "corporate RIA" will become increasingly prevalent. In this episode of the Transition To RIA question and answer series, I explain how corporate RIAs came to be, what sort of offerings currently exist, and what they'll need to do to be competitive g...
Nov 03, 2022•19 min
I am frequently asked how the economics of the Registered Investment Advisor ("RIA") model compare to the broker/dealer model. The first step in a comparison is to calculate your existing broker/dealer payout. However, you can't simply refer to a payout grid table, and conclude that is your payout. There is a reason advisor compensation plans generally run 20+ pages! What eventually flows to your pocket, is often far different from what the grid table would indicate. In this episode of the Trans...
Oct 19, 2022•27 min
Ever been told you shouldn't go the RIA route because you won't get any support? You'll be on your own? You'll be so busy doing administrative tasks you won't have time to be an advisor? Often, the people making such declarations have ulterior motives. Perhaps it's a branch manager, or home office executive that doesn't want to lose you from their firm. There is an entire ecosystem supporting the RIA model that makes such statements irrelevant. There are now even fully "SUPPORTED INDEPENDENCE" a...
Oct 03, 2022•28 min
It doesn’t happen often, but I do get asked……can I have foreign clients as an RIA? This is relevant if you have such clients in your current affiliation model, or you aspire to add them to your clientele upon transitioning to the RIA model. Similar to if you’re at a broker/dealer now, the answer is generally….it depends. In this episode of the Transition To RIA question and answer series, I explain when it is possible to do, as well as discuss the solution providers you’ll need to lean on to be ...
Sep 07, 2022•23 min
There are two ways to improve the profitability of a business. Increase revenues or decrease expenses. Preferably, you do both. The RIA model provides far greater flexibility than any other advisor model with your ability to impact each. How you manage that flexibility is what determines your bottom line. In this episode of the Transition To RIA question & answer series I discuss how to maximize the profitability of an RIA. Come take a listen! Show notes: https://TransitionToRIA.com/how-to-g...
Aug 23, 2022•38 min
There are two ways to grow an RIA. Organically from expanding existing client relationships and bringing on new clients. And inorganically, from acquiring practices and/or attracting advisors to join your RIA and bringing their clients with them. When doing the latter, it is important to understand the competitive landscape and what is expected of joining advisors. In the latest episode of my RIA question and answer series, I discuss 7 mistakes to avoid if trying to attract advisors to join your...
Aug 02, 2022•24 min
