Skip navigation
businessman-window-papers.jpg baona/iStock/Getty Images Plus

Eight Reasons Advisors Leave their Broker-Dealers to Start Their Own RIAs 

It is common to find oneself at a crossroads when considering proposing marriage, having a baby or buying a home. The decision to start one’s own business is no different.

When pondering your professional future, you find your mind wandering. You have clients you are proud of and a team you love. You are a very talented advisor and leader. You know you can achieve growth while taking care of your existing clients. You believe you should be your own boss, free to make your own decisions. But, what if. . . you fail?  

Every situation is different. There is no mile marker or AUM threshold that you pass and suddenly get handed a certificate that proclaims: “you are ready to go independent!” However, there are several indicators that you may be.  

To make this decision easier, here is a checklist that will either help you realize you are ready for the next step in your career, or tell you how far away you may be. Much like a technical analyst uses charts to inform their investing approach, these indicators will empower you to make a very important decision – and the right one for you:  

  1. You have a desire to become a true fiduciary: You are more focused on serving the wealth planning and investment management needs of your clients, and less concerned with the commission payment you might get from distributing a certain product. The limitation on choice for your clients and incentives for steering them into products that you find mediocre at best does not sit well with you.  
  2. You desire to have a fee-based advisory business: You deeply care about providing your clients with financial advice and guidance with the utmost transparency. Your client relationships are rooted in trust, free from conflicts of interest. You find yourself acting in your clients’ best interest even if it hurts your firm’s bottom line. 
  3. You are tired of constant compliance challenges: Your broker-dealer’s compliance model is managing to the lowest common denominator and the associated regulatory burdens are wearing on you. The compliance department seems designed not to protect you and your clients, but to protect the interests of the enterprise – which often means the default answer for any request – marketing, PR, social media, useful technology – is “sorry.”  
  4. You feel like you are being “nickel and dimed”: Being compelled to pay for things you don’t need will wear on anyone. For financial advisors, this feels like death by a thousand paper cuts. Power of choice and the ability to build your business and manage your expenses your way is one of the most alluring aspects of the independent channel. Pay for what you want, need and things clients appreciate.  
  5. You find less and less value in your broker-dealer’s brand: You have built momentum with your niche audience, and you don’t feel as though your B/D’s brand is helping you further build your book of business. Your clients are loyal to YOU, not the nationally recognized brand name. The brand doesn’t pick up the phone on a Saturday at 3 p.m. to assist with a critical financial life choice – you do.  
  6. You are motivated to build a brand infused with your own values: You are ready to take the leading role and your B/D’s values no longer align with how you want to work with clients. No matter the circumstances, you feel confident that you can deliver an outstanding client experience. You’ve already been doing it for years.  
  7. You have always had an underlying vision and belief in yourself as a CEO: You find yourself wanting to design and run your business your way and you are tired of feeling like a cog in the machine. More importantly, you want to lead and inspire your team. You’ve always led from the front and your team loves you for it. They’d follow you through good times and bad and know that you have their back – and vice versa.  
  8. You want to create, grow and scale your enterprise value: You see the opportunity to build and run a profitable business that, in the long run, will lead to economic incentives for you and your team that far surpass your earning potential at your broker-dealer. 

Does this sound like you? Have four or five of these thoughts crossed your mind? If so, do they excite you?  

If yes, it's time to take the next step, map out and refine your business plan and execute.


Colin Falls is president of GeoWealth, a modern TAMP with the sole focus on serving the needs of RIAs. 

Hide comments


  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.