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Time for a Transition (VII): RIA Starter Kit

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You've been thinking for a while about making the move from being a "registered rep" to operating your own RIA. Right now, it seems as if your move is equal parts of excitement and challenge.

Yes, you have a new sense of freedom, but it can seem daunting at times. As you ready yourself, just remember that good prep work can reduce your fears and increase the likelihood of success.

Clyde Wyatt, an independent advisor who as managing director of Navigation Financial in Dallas, has coached and mentored dozens of newly independent advisors, points out the advantages and challenges of independence. "As an independent advisor, you have the ability to structure your work lifestyle so that it complements your personal lifestyle, instead of overpowering it," he says.

You have the flexibility to choose the type of people and support staff with whom you want to work, he points out–but of course you have to be your own human resources manager.

In addition, continues Wyatt, you can structure your office hours or workdays to accommodate your needs and the needs of your clients — but you have to come to terms with the kinds of clients you want and what they require.

You have control to move your clients in the direction that you wish to go, in terms of products and services offered, for example–but you have to develop the knowledge and research skills to make those decisions.

Don Patrick, another independent advisor who manages "an elite consortium of advisors" under the banner Integrated Financial Group based in Atlanta, says, "You're not an employee. You don't have an employer. You are the business owner. It's total control, choice and absolutely an increase in profits."

With total control comes responsibility, of course.


Consider one of the biggest challenges you face as you go independent: the loss of a big brand name. You're no longer affiliated with a major well-known company. But Wyatt calls this "loss" a myth.

He realizes that some advisors are concerned about not being able to retain or attract clients without a big brand name, but has found that, particularly in today's environment, that fear is unfounded. "Some of the big brands can actually be a hindrance to an advisor's image," he says. Clients are looking for a trustworthy, competent advisor they can work with.

Another key issue is finding an office — it's the first thing you need after actually going independent. It's a big decision, but fortunately you have many options, according to independent advisor Arthur Cooper.

Cooper and his partner, David McManus, have under the banner Cooper McManus helped scores of brokers move up the independence ladder through their "Supported Advisor Platform." You can work from home, if you have the room; rent an executive suite; lease traditional office space; sublet from another professional group; or share space with other advisors.

Each has its advantages and disadvantages; you get to decide what's right for you.

Related to real estate is a decision about what kind of practice you want. Do you want to keep it small, working with a select group of clients, or expand with additional advisors over the coming months and years? That will affect your decision on the size of your office suite.

Of course, plenty of advisors like having their branding, office space and other key aspects taken care of — and that's fine. It's something to think about before making the leap. Many established RIAs and independent broker-dealer branch offices offer merger and/or stepping stone opportunities that create a less complicated path.

Yes, freedom comes with responsibilities, but there are many practical solutions, and we will be exploring them in the coming months.

Marie Swift is president and CEO of Impact Communications, a consulting firm that for over 17 years has worked exclusively with independent financial advisors and the institutions that serve them. Follow her on and read her Best Practices in the Financial Services blog at


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