I’m on a roll, it’s time to go solo.
-Vanilla Ice

Alliance Wealth ManagementLast year, I embarked on one of the most exciting business transitions of my life – I formed my own registered investment advisory firm.

I get a lot of questions from advisors wanting to know about the process. How does it work? How much does it cost? Is it worth it?

Plus, I have friends and blogging friends that are also curious and would love a look behind the scenes of starting a financial planning business.

Since it’s almost been a year underneath my belt of starting my own firm, I thought I would share a little bit of how it all went down.

Plus, I’m trying to get a sense of how much I have spent in the past year in doing so……thank goodness for my CPA!

Before I begin, let’s first start with a bit of a back story so that you can understand exactly what had happened…..

The First Step

In 2007, three others advisors and myself left A.G. Edwards and Sons, which had recently been bought out by Wachovia, which is now Wells Fargo, and started Alliance Investment Planning Group. We were an independent financial planning firm under the independent broker dealer, LPL Financial.

LPL Financial is the largest independent brokerage firm and the big difference between them and an Edward Jones or a Merrill Lynch (or any major brokerage firm), at least from the advisor standpoint, is that they allow you to create your own company at the local level.  That’s why we operated as a DBA (Doing Business As) Alliance Investment Planning Group.

Essentially, in that relationship, I was an independent contractor utilizing their services and then LPL held my licenses: my Series 7, and my insurance licenses.

Keep in mind that many advisors don’t take this step although it’s becoming more popular.  From a payout standpoint, it definitely pays to take some risks.   Let me explain…..

With A.G. Edwards, my payout was 40%.  That means for every commission or fee earned, I would give the company 60% of every dollar.   That was my price for having the company name behind me, back office support, my fully furnished office (phone, computer, desk, etc), a receptionist and anything else you would need to run an office.

For many, it takes away all the added pressure of running a business so that you can just focus on your existing clients and also getting more. .   Unfortunately, if you’re an obsessed entrepreneur like myself; it just wasn’t quite enough.

Moving to LPL meant that we now become true business owners.  We had to find our own office building, buy our own computers, desks, printers, filing cabinets, phone systems, 47″ TV’s (I will argue to this day that it’s a necessity! :) ), receptionist, etc.

Why would would anyone want to deal with that?  Because the payout increased from 40% to 90%.

Yes, that’s a pretty substantial raise.   What made it even more substantial is that we were able to split costs 4 ways.  (We eventually added 3 more advisors so everything was split 7 ways.)   That means: more money in my pocket!

My revenue increased dramatically because of this.  In fact, it has increased 4-5 times more where I was at when I left A.G. Edwards in 2007.

Trapped in a Box

My practice continued to grow and honestly I had no reason to change.  No reason whatsoever.

There was, however, this one little thing that occurred that eventually made me realize that change was not only coming, it was inevitable.

That “occurrence” was my blog.

As my blog continued to take off, and I got tired of the compliance hurdles, I knew that I needed to make a change.  If you have a Series 7 license, anything you do online comes with great scrutiny and everything, I mean EVERYTHING has to be pre-approved first.

Note: for those that aren’t familiar with our industry.  If you have a Series 7, you have the ability to sell a security (stock, ETF, mutual fund, variable annuity) and earn a commission.  If you can earn a commission, FINRA has fairly strict rules on how you discuss these types of securities.  That’s what makes blogging such a challenge for advisors with their 7.

Pre-approval is very time consuming, but that wasn’t the most frustrating part.   I was also limited to what I could say and how I could say it.   As an example, my post 7 Financial Advisors I Would Like to Punch in the Face would never have been approved.   Never!   And that’s why I enjoyed writing it that much more.  :)

Dropping the 7

To get the freedom that I wanted required me dropping my Series 7 and then forming my own RIA, registered investment advisory firm, with the state of Illinois. There were a lot of hurdles in my way in that I didn’t know how it all worked.

  • I didn’t know if could stay with LPL Financial.
  • I didn’t know if I could still be in the same office building with my current partners.
  • I didn’t know how to even begin.

I had a lot of fact finding to do.

Thanks to some good contacts, I learned that it was possible to operate in the same office as my other partners, I would just to create a separate entity, hence, Alliance Wealth Management, LLC, was born.

I had to get new phone number, order new business cards, and change my literature to reflect these changes.

Now, the question was who was going to be my custodian. The custodian is the provider that offers statements, a trading platform to buy and sell investments, among other things.

LPL Financial has an RIA platform, I just didn’t know if it would all work out. Sure enough, it did, so currently, that’s who I’m using.

This was an easy transition for many of my clients since they would continue to get the same statements and most would keep the same account numbers.

Another note:  this is probably the most confusing part about the whole process that was hard for my clients to fully understand, especially since I’m still with LPL.   The easiest way that I explain it is that I just switched departments within LPL’s business structure.   Before I was an independent agent/contractor with them.  Now my firm Alliance Wealth Management, LLC is a client utilizing their custodian services.   LPL no longer holds any of my licenses and they are not responsible for me.  Instead, the State of Illinois is now responsible for me.    Clear as mud? Good. :)

So, once I found out that I could be in the same office and I could stay on with LPL as my custodian, it was time to begin the process. That’s when I contacted a compliance attorney that would set up all the documents that I would need and help me get registered with the state.

I also needed to set up a new LLC and then contacted my CPA who helped me with that process. In May of 2011, the transition was ready to begin.

Setting up Shop

Starting a financial planning investment firm

Getting Your Firm Started

As mentioned above, I end up sticking with LPL Financial as my RIA custodian.  So in that regard, there wasn’t any cost in switching.  A few other ones I looked at were Schwab, Scottrade, E trade, and Fidelity.  The biggest reason for me sticking with the LPL was

  1. Less paperwork. (It still was A LOT, but less if I would completely switched)
  2. Easier story for my clients. (I had left A.G. Edwards in 2007 and going through another change I thought might be too much).
  3. Convenience of billing.  (See below)

With most of my revenue coming from assets under management (I earn a % of my clients assets invested with me), LPL takes care of calculating the fee, deducting the fee, and then sending me the appropriate payment.

When I researched a few other custodians, I learned that this was something that I had to do on my own, and that honestly did not excite me at all; so as far as costs associated with being with LPL, mostly it’s just ticket charges.  Mutual funds were ranked anywhere from $5 to $26.50; equity trades are approximately $15, and other investments such as bonds or UITs are somewhere in the $50 range.  Note that I don’t do a lot of these trades, so I don’t know the exact cost.  Most of my trading costs involve mutual funds, stocks, and ETFs.

The Major Expenses

Compliance. The first major expense was compliance.  I had to find someone to set up my ADV (client brochure) and begin the process of setting up my advisory firm with the State of Illinois.

LPL had a few vendors that they referred me to, and I tried calling a few of them, but their timelines did not mesh with mine.  Their costs ranged anywhere from $2000 to $5000, depending mostly on what state they were located.  The ones in New York seemed to charge the most.

Through my blog, I’d met another advisor who had gone the RIA direction, and he referred me to his compliance guy that he had used.  The setup fee was $3,000, and he took care of the entire process; and let me tell you, the $3,000 was totally worth it.

  • Total cost: $3,000.00.  Recurring cost: $2,000 per year.

LLC Setup.  The second major expense was getting the LLC set up; unfortunate to live in the state of Illinois, where just to set up an LLC runs you around $450 to $500 (note heavy sarcasm).  I could have set it up myself, but I honestly don’t feel comfortable, so my CPA helped in that process.  Total cost there was $850.

  • Total Cost: $850.  Recurring cost: $250 per year.

Business Lost. The other major cost for me was the business that I lost.  I had a decent amount of money tied up in variable annuities and some 529 and 403(b) accounts that I wouldn’t be able to transfer.

In addition, I had a relationship with a local credit union where I was their choice advisor that they would refer all their investment business to me.  That was another relationship that I had to give up if I was going to start my own firm.  While, it’s hard to tell the exact numbers;  I’m estimating that I gave up approximately $36,000 every year of recurring income to go the RIA direction.

  • Total revenue lost:  approximately $36,000 per year.

Insurance. Oh the joys of having your own business.    With my profession, you need both business liability insurance and professional liability insurance (E&O).   The business liability runs we $1,470 per year (that also includes worker’s comp for my new employee) and $3,654 per year for E & O.   The E & O is about $1,000 more per year than I was paying with LPL but I decided to go with a carrier that specializes in investment advisers.

  • Total cost: $5,124 per year.  Recurring: same.

Office expenses.  Since the office was already set up, we already had phone systems intact, and the way that it worked before was that we all just split the phone bill equal ways with my other partners. Now that I had to have my own dedicated phone line, I had to add two full extensions and a fax line for my new office.

Luckily, we were able to program those new lines on the existing phone systems so there wasn’t the cost of having to buy new phones.

Furthermore, one of my partners in the office has a good friend who works for the local phone company, so I was able to get the installation costs waived, which was a big savings, but having to get my new phone systems still added on an additional $140 a month to have my own phone system.

  • Total cost: $140 per month.  Recurring: same.

New fax line. One area where I was able to cut costs was the fax line.  I figured that I was paying approximately $30 a month just to have an open fax line, and that was without sending any faxes.  I looked into some online providers, and the one I settled on was Nextiva.  For $60 for the entire year – $5 a month – I am able to have a fax line that works directly with my email system.  Thus far it’s been very reliable, and I would definitely recommend it to any small office that needs a fax line but doesn’t send hundreds of faxes per month.

  • Total cost: $60 per year.  Recurring: same.

New letterhead and business cards.  Since I had a new business name, new phone number, and new email address, I had to get new stationary.  I didn’t change the logo that much, so our logo graphic designer was able to make changes fairly easily.  Overall, I think I had to pay about $200 to get new stationary and business cards, which wasn’t that bad.

  • Total cost: $200.  Recurring: none.

New website.  Now that I had a new business, I knew that I had to have a new website, especially one that looks slick, but I wasn’t crazy about having to pay $300-$500 to set this up.  I was lucky, in that a friend of mine offered to essentially set it up for free.  I already purchased the domain for $10, and I got a snazzy-looking website.  Nothing like saving a little bit of money!

  • Total cost: $10.  Recurring: $10 per year.

Banking costs. The other most annoying fee is with our local bank.  We currently have free checking with compete online access, and my wife is a big fan of being able to pay stuff online; but now, instead of getting paid as an individual, I get paid into my business account, Alliance Wealth Management LLC, and it has its own separate tax ID number, my bank does not allow to do online transfers when you have two tax ID numbers.  (Side note – I also have another LLC set up for my online business. )

To be able to transfer money between the three different tax ID numbers, the bank charges us $35 a month to do so.  Right now, we are paying it, as it is a convenience, and we’ve been with this bank since I was sixteen years old.  I will say that we are exploring other options.

  • Recurring cost:  $35 per month.

The current rent:  Before beginning the transition, my total overhead was $1075 per month.  I am sure many people would look at that and laugh.  Yes, I live in the Midwest where things are cheap.

Since I’m still occupying the same office, I have the same printer, same desk, computer, bookshelf that I had before, and so there weren’t any greater expenses on that end.

We have a 3500-square-foot building that we pay just about a dollar a square foot a month for rent.  We also have one assistant and all the typical expenses you would have in a professional office.  All those expenses are split seven ways, which makes my share ridiculously inexpensive.  Those costs include the other phone system, postage, Direct TV – that’s for my 47-inch television in my office – heating and air condition, electricity, taxes, and insurance.

  • Recurring Cost: $1075 per month.
Alliance Wealth Management Office

Yes, the TV is a necessity :)

Other Costs to Running a Financial Planning Practice

What I’ve pretty much outlined up above are the essential costs that I must have to run the business.  These others are add-ons, meaning that I could probably get by without them, but they definitely make running a practice much easier:
1.      Blue Leaf:  Blue Leaf is an online account aggregation program that I’m testing.    It gives my clients the ability to log in and sync all of their accounts together, whether they be with me, their existing 401(k), or any statements held elsewhere.  Cost: $250 per month.

Try Blueleaf for free.  You can test drive their service and if you decide to sign up with them, mention me and you’ll get 2 months for free.

2.      Marketing Library:  This is an article-writing provider that runs me $20 per month.  I use this for newsletters to existing clients as well as getting article ideas for the blog. Cost: $20 per month (Cancelled as of 06/06/2013)
3.      Morningstar:   With this Morningstar subscription, I am able to do detailed analyses of existing client portfolios as well as break down potential new client portfolio.  Cost: $160 per month (Cancelled as of 06/06/2013)
4.      Erado:  Erado is my email archiving company that houses all my emails for compliance purposes. Cost: $375 per year
5.      Arkovi:    Arkovi is a social media archiving company.  They keep a log of all my social media efforts between by RSS feed, Facebook, UTube, LinkedIn, and everything else. Cost: $40 per month
6.      The Birthday Company:   This is a service that I use to send out birthday cards to existing clients.  It’s an automated process that I enjoy, and I get positive feedback from all my clients.  Cost: Approximately $15-$20 per month

Association Costs

As a CERTIFIED FINANCIAL PLANNER™ professional, I also have my dues that I have to pay.   Total Cost: $325 every 2 years

I’m also a member of the Financial Planning Association.  FPA is the largest membership organization for personal financial planning experts in the U.S. and includes professionals from all backgrounds and business models.  Total Cost is $395 per year. 

Lastly, I have kept my insurance license open and that costs me roughly $180 every 2 years.

Total Costs

As you can see, it’s not cheap to start your own financial planning firm, but I can say that’s it definitely worth it.  I’m exactly where I needed to be to grow my practice and my blog on my terms.

The one cost I haven’t mentioned yet is hiring an employee which I just did October of last year.  That has brought on a whole new set up challenges, but once again has been worth it. I’ll have to share those details in another post.  :)

Are you considering starting your own business?   Share your comments below. 


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Comments | 67 Responses

  1. Bonnie says

    Thanks, Jeff, for writing this. It’s definitely the most transparent break-down I’ve ever seen of the costs of going independent. The only thing I’m confused about is how are you still able to make equity trades if you gave up your Series 7 license?

    • Jeff Rose says

      @ Bonnie

      As an investment adviser, I can still place equity trades with my custodian, but I just don’t earn a commission on them. I would just collect my advisory fee on the account.

      As mentioned above, most my clients don’t own a large percentage of stocks in their account, but for those that do; they are in the same accounts with their other holdings (usually mutual funds).

  2. Kim says

    Great article! Did you have to get a Series 65 & 66 when you dropped your 7? Are you truly able to recommend the best available options to your clients with the RIA LPL platform? For example, if the best, lowest cost vehicle was a Vanguard fund will LPL be the custodian?

    • Jeff Rose says

      @ Kim I already had my Series 66 that automatically converted to a Series 65 when my 7 dropped.

      I can recommend whichever funds I choose or I can charge the client hourly and they can custody the assets wherever they please. Most of my revenue is generated via a % of AUM, but I have been doing more with planning fees since I formed my own RIA.

    • says

      @ Brent Primarily I use it for article ideas and some of the stats they provide in the articles. I will sometimes use them to send out email newsletter to clients especially if they come out with a timely piece.

  3. Hunter Lappen says

    Excellent article, I have been taking notes! Do you still use Redtail for CRM? I think you forgot to include that in your list of expenses if you still use that or another CRM. Also, what does it cost to keep your Series 66? Keep up the great work thanks!

    P.S. check your inbox when you get a chance, I sent you an email, thanks again!

  4. says

    Hi Jeff, I found you through a Google search as I’m looking to set up my own RIA practice. Your article was super helpful. I’m wondering, if I might ask (a) how much time you spend on compliance each year? I’d love to know.

    With gratitute,

    • says

      @ Lisa I hired a compliance attorney to set up my ADV and make sure I’m good to go. I don’t think I hardly spend any time on it really.

      FYI, I’m registered through my state, not the SEC.

  5. mike0725 says

    Hi Jeff,

    I looked up this post for information on starting your own RIA, but I got an added benefit when I read about the software and services you use. What is the verdict on blueleaf? I have tried account aggregation software before and so far have not been impressed. I love the idea. I have just been finding it hard to get a good vendor.

    I would love to know what you think.



    • says

      @ Mike Bluleaf has been really simple to use and their framework is very clean and fresh. They handled most of the grunt work of getting all my accounts aggregated which was also huge.

  6. says

    Jeff – this article is over a year old now but still quite useful & relevant. Thanks! But, do you have any updates or changes that you have made? Please feel free to direct me to appropriate place on your website if the response is redundant.

    • says

      @ Julie Everything is pretty much the same. The only two tools I’ve dropped is Marketing Library and Morningstar, because I just wasn’t using them.

  7. Robert says

    Can you get a series 65,66 and 7 without a sponser or do you need a sponser? and whats the easiest way to get one? How long did you work before starting your own business?

    • says

      @ Robert You do not need a sponsor to get a Series 65. I’m not certain, but I think you do for the Series 7.

      I was with another brokerage firm for 5 years before I left to co-found our firm. 3 years after that is when I broke off and founded my own RIA. I’m still in the same office so my overhead didn’t change.

  8. David M says

    Thanks for doing this. I have been thinking of starting my own practice. Got CFP in 2009 and really loves financial planning. But I find it hard to leave a steady income in client service and pursue my passion for financial planning. I have all the business plans detailed (although your website quote is very nice know and I’m happy I did not go with the quotes I already have for that) but just starting out on my own with no book of business scares me.

    • Steven says

      David, your comment in particular sparked my interest as I am a CFP in a client service role myself but considering taking the plunge and starting an RIA. However, with no clients, this is extremely risky. Have you made a decision and also, would you be able to share you business plan as a guide?


  9. Roger Whitney says

    Good Stuff. We are an RIA with LPL and are considering Blueleaf. Have you been happy with the integration?

    Are you able to do actual performance reporting with Blueleaf or just account agg.?


    • says

      @ Roger Integration was a snap. The performance reporting is good but it only works for the time that the accounts have been synched with Blueleaf (unless they’ve updated it).

  10. Luke says

    Hi Jeff, did you have any non-compete or non-solicitation agreements to workout when you left A.G.? I’m interviewing with Edward Jones and it’s up in the air wether to go independent or with them. Either way I’d love to go independent eventually but not sure about the legal consequences. Thanks!

    • says

      @Luke I had a 5 year non-compete with A.G. but luckily I had just surpassed the 5 year mark when I left so it was a non-issue.

      A few of my partners we’re still within the 5 year window and they had to abide by the non-solicitation rules. They also had to pay a good some of money when they our old firm claimed they had to pay a pro-rata reimbursement for the training costs incurred.

      Definitely understand your contract before you sign.

  11. Jason says

    Great article! Thanks for your time and your expertise.

    If you had to advise someone thinking of going independent what would be the minimum AUM to start your own RIA Firm vs. joining another Established RIA Firm .

    Thanks again!

    • says

      @ Jason I don’t there’s really a minimum you need to get started. There are several RIA’s that don’t manage investments; they charge a fee for financial planning services.

      Minimums would be a factor working with certain custodians. When I made the switch my custodian had a minimum of $25m in AUM. Other custodians range from 0-$50m.

      Hope that helps!

  12. Chris says

    Jeff, you mentioned that you had to give up a relationship with a local credit union that you currently have. Why was that?

    • says

      @ Chris My former broker/dealer had a division that specifically worked with banks/credit unions and that’s what I used to establish the relationship. I could have tried to get the Credit Union to switch over to my RIA, but; to be honest, I wasn’t interested. The Credit Union had a totally different clientele that I was used to and I preferred to walk away (I was able to pass on the relationship to one of my former partners).

  13. Jacoby Wilkerson says

    Hello Jeff, I’m an undergrad student in my junior year. I have one year left to I graduate and I want to go into a career in finance as a financial planner or advisor, then eventually own my own firm like you. Should I go to grad school or should I start my career? I’m nervous tha I will accumulate more debt in grad school, because I’m already in major debt from loans for school. I don’t want to spend 25 years paying it back while my career, but I know grad school can boost my salary. What’s your advice?

    • says

      @ Jacoby Using myself as an example, I didn’t get my MBA. Many of the advisors in my office when I started (and my current partners) don’t have their MBA either. I would focus on getting the CFP Certification.

  14. Alex Zander says

    Hi Jeff,

    You mentioned at the end of your post that you were looking to hire employee. What are the costs fir a process like that?


    Alex Z.

    • says

      @Alex There’s not a lot of cost involved in finding someone. I’ve used Facebook to find people and also found Indeed.com to be very helpful. I tried an employee placement company locally but didn’t have much success.

      As far as out of pocket, the BIG expense is health insurance. Luckily, the two employees I’ve had didn’t need it.

  15. David says


    Great article with information that is still applicable 2+ years after it was written. I am currently exploring the RIA model. Who did you use for the initial setup?


  16. Robert says


    I hope you, the family and the practice are doing well! This was a phenomenal post, great job! I just graduated with my MBA, with an emphasis in corporate finance, and I am looking to get into the financial industry. I have done some research on LPL Financial and I am wondering if their are any pre-requisites (e.g., must have series 65, must have 3+ years advisor experience, etc.). If a series 65 (or 66) is needed, does LPL Financial allow you to apply with them before you obtain the certifications?

    Thank you

    • says

      @ Robert LPL is more for advisors that have some experience and a book a business, not so much for new advisors. I’m not totally sure on this but they may have a production minimum (commissions and fees) before they’ll allow you to come on board. I think when we came over in 2007 it was $125,000 but I don’t remember for sure.

  17. Michael R says


    Glad I found your posts! I am currently at a wirehouse for 2 years and I am an attorney (NY/NJ). I am increasingly frustrated at the difficulty growing organically in the wirehouse world where compliance and oversight make even the most straightforward marketing activities cumbersome and unproductive. I would very much like to go independent. Most of my current clients are commingled with other advisors (mostly situational teams) and I am not looking to burn those bridges and start competing with my current friends/coworkers for these accounts. I have some available capital (1.5-2mm) and would rather look make an investment in an existing practice. Do you have any thoughts about this path? Once I am on my own what is the likelihood of finding a good practice to acquire? Would you advise becoming a partner in an existing firm rather than acquiring a book from a retiring advisor? Thanks for your insights.

  18. Scotty says

    Great article Jeff. I’m making the transition from owning insurance agencies (P&C, L+H) to hoping to have my own Financial Planning practice in the next 5 years and your article really gives me insight into a lot that could be involved with that transition. Thanks

  19. Jessica says

    Hi Jeff,
    Thank you for sharing this! A payout ratio increase from 60% to 90% is definitely huge. But I also know some firms that offers 80% payout ratio, though the advisor has to pay for Morningstar and CRM, E&O insurance …what would be a turning point ratio for an advisor to go solo, from your perspective? Thanks again.

    • says

      @Jessica The payout was definitely nice, but what mattered more in the long run was having more freedom to run my business the way I wanted to. Even if I had the same payout after expenses, it’s hard to put value on that. To answer your question, I don’t think there’s a clear cut number. Depends on the advisor and what matters to them the most.

  20. Noah says

    Great post. Currently associated with an RIA where cost are covered Im 1099 at 65% payout. I also help out the firm with a lot of marketing and other things. We use Schwab and I less than impressed. Love your blog and growth plans. Also would be curious to know what it would cost to add an advisor to an existing rIA. My thought is obce established. It could be don for 10k-30k per year? Thoughts?

    • says

      @Noah That’s actually a great question and one I’m hoping to find out soon. My plan is to add another advisor to my firm. The trick is whether they have an existing book of business or not.

  21. Tim says

    Great info here – Thanks!
    Have a question: if I’m associating with an RIA, can the RIA pay my LLC, or does the RIA have to pay me directly, as the advisor (andd then I would forward the comp into my LLC)?
    Someone told me they thought(?) Fed law requires the RIA to only pay the advisor and not their LLC or any other entity…

    • says

      @ Tim I have an advisor under me and I currently pay his LLC (not him direct). I asked my compliance attorney about this and he said it didn’t matter either way. Definitely get a second opinion. I also put you in touch with my attorney, too.

    • says

      If you are having your commissions electronically sent to your bank account it has to be a perosnal bank account associated with your individual social security number.

    • Sean Kernan says

      Great question Michael — I have acquired a couple small practices and many advisors I talk to ask a similar some version of this question (Jeff, I’m an OSJ at your last b/d). FPTransitions.com has a listing service where you can keep tabs on what comes to the open market. However, I have found the best way — by far — is to develop your own relationships with potential sellers. There are a few different ways to do that, but old fashioned networking with advisors close to retirement age has been very successful for me.

      • says

        Sean, thanks for the reply. As a follow up since I first posted that question, I have left the wirehouse world and have gone into private practice as an estate planning attorney and investment advisor rep. While its a lot of work managing two practices it’s rewarding in that I finally feel that I have independance. Also, the company I chose to affiliate with was a great fit as the majority of their advisors are either CPAs or attorneys and they were completely accommodating from a compliance and management perspective.
        I agree with you about the best way to make acquisitions to be from personal connections and I am actively working on a number of advisors at my former firm that were nearing retirement.

  22. Hank says

    Hi Jeff,
    There are plenty of known and unknown (unexpected) variables when running your own business. Would you recommend hiring a coach in helping to guide us in setting up and running successful independent advisory practice ?

    • says

      @ Hank Depending on where you’re at in your business, I would definitely advise hiring a coach. In fact, 4 years ago I did. :)

      I was referred to The Strategic Coach Program and it’s helped almost triple my revenue in under 4 years (note: it’s not all from my financial planning practice). You can read my in depth write up here.

      I’m horrible and building/creating processes but now understand the importance of having them. That’s just one of the many benefits I’ve gained from being in the program. Hope that helps!

  23. Justin says

    Jeff, thank you for this post it is exactly what I had been looking for. I am currently in the process of working towards my 7,66, then my CFP.

    My question has to do with restrictions on blogging. Was that something your firm put in place to pre approve ? I can’t find anything online about FINRA restricting publishing and I see series 7 licensed individuals writing for financial sites all the time. Anywhere I can get more information on this to see what is or is not allowed once you have your license? My hope is to be able to write and also own my own company like you, but in NY.


    • says

      @Justin If you have your Series 7 and affiliated with a broker/dealer, they will have their own policies on blogging and social media. They are all different. Mine was willing to work with me, but I still had to get everything pre-approved which would take 5-7 business days to get it approved – which I hated! :)

  24. Jeff says

    I am about to join an RIA as a full-time trader in MD. Do you know which salary I should expect? It’s not a BD so there will be no commission.

    I’ve searched everywhere and am just unsure.

  25. says

    Hi Jeff! Thanks so much for this post! It really helped put things into perspective. I’m an insurance agent thinking of pursuing a series 6 and then potentially a CFP license. Strangely enough insurance is my passion and I’ve recently been intrigued by the idea of adding financial consulting in the mixture. It seems like it’s easier to build relationships with clients and get into more detail with them about their needs.

    Let me make sure I understand something…you are able to offer this advice to clients because you hold a CFP, correct? I couldn’t do such a thing with only insurance licenses, right? I would need to obtain some sort of financial adviser credentials. Am I following you?

    Thanks for your time!

  26. Joe says

    Jeff I’m also intrigued about your decision to dump your Series 7. I’m about 80% out the door of my current advisory role at a large investment house, looking to go out into the wild unknown in order to start my own financial planning firm. I’ve been writing for years and would want to incorporate some sort of blog or personal material into my website and others’ websites, but like you I was unsure of the regulatory scrutiny.

    If you dump the Series 7, you’re free to post whatever you want, without any strings attached? And my more targeted question for you is whether there have been any other undesirable side effects of no longer having your Series 7. Finally, I need to find a good compliance attorney and nail him with about 50 of these kinds of questions – any advice on how to find a good one? Thanks buddy.

    • says

      @Joe You’re definitely to post more freely but you still have to stay within reason: no outlandish claims. It’s been over 4 years since I dropped my 7 and there hasn’t been one ounce of regret from doing so.

      As far as compliance attorney, I was referred to Jim Cullen now of Financial Planners Assistance and I’ve been very pleased. I’ve referred a handful of other advisors to him and haven’t had one complaint yet. http://www.financialplannersassistance.com/

  27. Dan says

    Hi Jeff — LPL rep here. Great post, thanks! It’s been 4 years since your transition, are you still using LPL as the main custodian? Any other custodians you recommend?

    Also, are you a Fiduciary? I’m in the process of becoming an IFA but still have some insurance business, so I’m curious to learn your interpretation of the Fiduciary Standard while offering insurance.

    Thanks for your comments!

    • says

      @ Dan LPL is my main custodian. I’ve recently started working with FormulaFolios as an investment manager and they have relationships with Fidelity, TD, Schwab, and Folio Institutional.

      As a RIA and a CFP®, I am a fiduciary. Most of the insurance business I do is term so I work with Pinney Insurance to make sure I have access to 40+ carriers to get the best rates.

    • says

      If you are interested in another custodian, take a look at WBB Securities (www.wbbsec.com). We welcome RIA’s, Hybrids, and brokerage accounts. In addition, we are affiliated with a wonderful insurance General Agent for any of your insurance needs. We are a boutique firm with more personalized service than LPL offers.

  28. Jason says

    Hi Jeff,

    Thanks for the great article. I was wondering, would you have to drop your series 7 to be able to offer clients something like your “Financial Blueprint” to success. I.E other financial planning services via internet marketing and the alike?


    • says

      Jason, Jeff made this comment above back on 2/23/15: “If you have your Series 7 and affiliated with a broker/dealer, they will have their own policies on blogging and social media. They are all different. Mine was willing to work with me, but I still had to get everything pre-approved which would take 5-7 business days to get it approved – which I hated! :)” Essentially you don’t HAVE to drop your 7, but it makes things a lot easier to create content the way Jeff is. I have a hybrid RIA so I am familiar with both sides of this equation, and it is night and day (and without the 7 is the day!).

  29. says

    Hi Jeff,

    Great to see this article still generating conversation a few years after the original post. I found you through Michael Kitces a few months back and haven’t stopped visiting since. Keep up the great work.

    I’m stuck in a unique position and am wondering if dropping the 7 and forming my own LLC is the solution… I am with a 5 person RIA under LPL’s hybrid program so we have our own dba and we are each in separate offices approx. 30-40 miles from each other. My colleagues tend to be more generalists while I would like to star focusing on working with business owners.

    In an effort to promote this, I’d hoped to start a blog with relevant and timely content on everything from retirement plans to new technology for businesses. However, after speaking to LPL regarding this, I was told it couldn’t be done because “anything financial related on a website related to me would require all the same disclosures as our company website, and in turn, be subject to pre-approval.” I can’t get a clear answer as to why, but they hinted around that I could look into my own dba. I’m lost but not not willing to accept this answer.

    Any ideas on why this may be the case, especially considering your past experience with a group and current LPL relationship? any suggestions on who I might talk to at LPL because the person giving me the answer doesn’t seem to have much of an explanation and is extremely slow in getting back to me whenever I call. Everything we post on our website requires pre approval as well which I thought was not required as an RIA. Any help would be appreciated and if you prefer to respond via email, that would be great too.

    Thanks for the time – sorry for the long winded post but we have a very similar background and I have a great amount of respect for your work so I figured “hey why not just reach out to Jeff Rose!”


    Mike Pruitt

    • says

      Hey Mike,

      What you’re describing is why I didn’t go the hybrid approach; I was told I would still have to get posts pre-approved since I still had my Series 7 and LPL was holding it.

      You’ll never get the freedom you desire unless you

      1. Find a broker/dealer that won’t care (Don’t advise this for obvious reasons)
      2. Drop your 7 and go full RIA.

      It made sense for me because I had been blogging for 2 1/2 years and saw success with it. You might go the pre-approved route to see if you like and it the blog picks up traction first before you decide.

      One thing you should know is once (if) you make the shift, you’ll be totally happy you did. This is one of those times the grass is definitely greener on the other side :)

      • says

        There is another option… You can keep your hybrid model and find a Broker/Dealer that takes a more personal approach to helping you with your business. LPL is a large firm and unless you are a top 1% producer considers you just a number. A smaller boutique firm doesn’t view you as just a rep code, but as a person. I am the Chief Compliance Officer for WBB Securities and the turn around time for approving a blog/ website changes, etc is within 4 hours. While we do have rules regarding content, due to FINRA regulations, we work with you to keep you compliant while helping you grow your business.

  30. says

    Congrats on your blog and starting your business Jeff! :) As most of you already know the compliance burdens can be stressful, confusing and often require professionals who can provide targeted and affordable guidance. Not only do new advisors need to file the ADV documents, but they must be competent in the state and federal rules that apply to ALL advisors, no matter how big or small. Regulators expect customized compliance programs, manuals and legal client contracts with the appropriate provisions, no matter your size and structure. I’m happy to answer any regulatory questions anyone has or feel free to visit my website for more complimentary information http://www.bostoncompliancellc.com. Best to all! Tina

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