Transition To RIA Podcast

Super-OSJ or RIA? Let’s start with what is an OSJ? Let alone, what makes an OSJ “Super?” And then how does it compare to an RIA? If you are considering joining either, it is important to understand the distinct regulatory and competitive differences between them. In this episode of the Transition To RIA question & answer series I explain how these two models differ, and why you might choose on...

“Hybrid” “Hybrid RIA ” “Hybrid Broker-Dealer ” Are they the same, or are they different? Depends on who you ask! Solution providers will often tout having a “hybrid” solution. Their version of hybrid though might be very different than what you are assuming they are referring to. In this episode of the Transition To RIA question & answer series I explain how these different “hybrid” solutions...

To celebrate the 100th episode of the Transition To RIA question & answer series, I was joined by special guest, Michael Kitces. He graciously accepted my request to come on the show where I would attempt to challenge him with seven questions about the RIA model he has never been asked before: Will we ever see the equivalent of a Chick-Fil-A in the RIA industry (a systematized business with bo...

Thinking about starting an RIA? Beware of industry voices bent on scaring you out of it. Whether due to naivety or because they’re agenda driven to keep you from making a change, there is no shortage of people expressing falsehoods about the RIA model. The resulting misconceptions often relate to managing compliance as your own RIA. In this episode of the Transition To RIA question & answer se...

I’m an advocate of the RIA model. Better economics and increased flexibility are why it continues to be the fastest growing channel in the industry. But it’s not for all advisors. Whether because of the profile of your practice, your desires as a financial advisor, or external variables somewhat out of your control, the model may not be a good fit for you. In this episode of the Transition To RIA...

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 t...

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...

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 pickin...

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...

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 thi...

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...

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 thi...

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 i...

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 ho...

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 &...

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...

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 epis...

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 insurmo...

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 prac...

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...

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 a...

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...

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 discu...

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 trans...

"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 po...