How to become an
independent financial advisor.
A step-by-step checklist for advisors leaving a wirehouse, broker-dealer, or insurance platform. Registration, technology, custody, compliance, and client communication, in the order most teams actually tackle them.
The eight steps, end to end.
Most advisors are fully operational 4–6 weeks after they commit to a launch date. This guide walks the work in that order.
- 01Decide what kind of independent you want to be
- 02Choose your business structure and entity
- 03Register as an RIA, or affiliate with one
- 04Pick a custodian and core technology stack
- 05Build your compliance program
- 06Plan your exit from your current firm
- 07Communicate with clients during the move
- 08Your first 90 days as an independent
Decide what kind of independent you want to be.
"Going independent" can mean several different business models. Pick the one that matches the practice you actually want before you spend money on entities or vendors.
The three most common paths
- Independent RIA. You register your own firm (or affiliate with one) and provide advice for a fee. Highest ownership and economics; you own the brand, the clients, and the model.
- Hybrid RIA. Fee-based RIA plus a commission relationship with an independent broker-dealer. Useful if you still need to service insurance, A-shares, or annuities for legacy clients.
- Tuck-in / supported independence. You join an existing RIA (like AFS) that handles compliance, billing, technology, and operations while you keep your own brand and book.
Questions worth answering on paper
- What percentage of revenue is fee-based vs commission today?
- Do you want to own and run a firm, or just own your practice?
- How much operational work do you want to take on yourself?
- What does success look like in year one vs year five?
Choose your business structure and entity.
Before you can register, you need a legal entity that will be the advisory firm or your DBA.
Typical setup
- Form the entity. Most independent advisors operate as an LLC taxed as an S-corp. Work with a CPA familiar with advisory practices on the election.
- Get an EIN from the IRS. It's free and done online in minutes.
- Open a business bank account in the entity's name. Keep personal and business finances separated from day one.
- Reserve your brand. Domain, email, social handles, business name registration in your state.
- Get an E&O policy quote. You'll need to bind coverage before you register.
If you're tucking in
If you affiliate with an existing RIA, you can often skip entity formation entirely or keep a simple LLC for tax purposes. The supporting firm handles the regulated entity and you operate under your DBA.
Register as an RIA, or affiliate with one.
RIA registration runs through the SEC or your state securities regulator depending on AUM. Plan for 4–8 weeks once your filings are clean.
State vs SEC registration
- State-registered: generally under $100M AUM (rules vary by state).
- SEC-registered: generally $100M+ AUM. A handful of states defer to SEC at lower thresholds.
What you'll file
- Form ADV Part 1: firm structure, ownership, AUM, disciplinary disclosures.
- Form ADV Part 2A (brochure): services, fees, conflicts, in plain English.
- Form ADV Part 2B (brochure supplement): each advisor's background and credentials.
- Form ADV Part 3 (Form CRS): the client relationship summary.
- Form U4: the individual advisor registration through FINRA's IARD/CRD system.
If you affiliate with AFS, we handle the regulated filings. You bring the practice, we bring the registered entity.
Pick a custodian and core technology stack.
Your custodian holds client assets and is the spine of your technology. Pick this early, because it dictates a lot of the rest.
Custodian shortlist
The major RIA custodians today are Schwab, Fidelity, and Altruist. Each has trade-offs around minimums, technology, service model, and asset-based fees. Get demos from at least two before you commit.
The core technology stack
- CRM: Wealthbox, Redtail, Salesforce FSC.
- Financial planning: eMoney, MoneyGuidePro, RightCapital.
- Portfolio management & reporting: Orion, Black Diamond, Tamarac (or your custodian's native tools).
- Trading & rebalancing: iRebal, RedBlack, custodian-native.
- Document management & e-signature: DocuSign, Box, ShareFile.
- Email & archiving: Microsoft 365 or Google Workspace with a compliant archiving overlay (Smarsh, Global Relay).
- Website & client portal: typically delivered by the custodian or planning tool.
Pick fewer, well-integrated tools over a bigger stack. Every additional system is another vendor review, another data feed, and another point of failure.
Build your compliance program.
Compliance isn't optional infrastructure. It's the operating system of the firm. Stand it up before launch, not after.
The non-negotiables
- Written policies and procedures covering supervision, code of ethics, privacy, cybersecurity, marketing, books and records, and business continuity.
- Chief Compliance Officer, named on your ADV. Either yourself, a partner, or an outsourced CCO.
- Cybersecurity program: written information security policy, MFA on every system, encrypted laptops, vendor due diligence.
- Annual compliance review, calendared from day one.
- Email and social media archiving with searchable retention.
- Marketing review process compliant with the SEC Marketing Rule, including testimonials and performance disclosures.
If your bandwidth is thin, outsource compliance for the first 12 months. The cost is cheap insurance against a deficient first exam.
Plan your exit from your current firm.
This is the highest-risk step. Get specialist counsel before you do anything that could be construed as solicitation while you're still employed.
Before resignation
- Read your contract carefully, including non-solicit, non-compete, garden-leave, and notice-period clauses.
- Confirm Broker Protocol status. If both your current firm and your new home are Protocol members, you can take a defined set of client information on the way out. If not, you take nothing.
- Engage a transition attorney who specializes in advisor moves. A few thousand dollars in legal fees prevents seven-figure problems.
- Build your ACAT and repaper kits in private, but do not contact clients, do not pre-populate forms with client data, and do not download anything you aren't entitled to.
Resignation day
- Resign in writing, in person if possible, and keep it short and professional.
- Return all firm property the same day.
- Have your new firm operational (phones, email, website) by end of business that day.
- Begin client outreach only after you've officially resigned (and within Protocol if applicable).
Communicate with clients during the move.
Clients hire you, not the logo on the door. Most stay if you make the move easy for them and lead with their interest, not yours.
What to say
- Lead with the why. Independence, fiduciary alignment, simpler model, better technology, in plain language, in 90 seconds.
- Be direct about what changes (new custodian, new statements, new paperwork) and what doesn't (you, your team, your investment philosophy).
- Make the paperwork painless. Pre-filled DocuSign packets, a clear checklist, a real person on the phone.
- Don't trash the old firm. Clients notice. Stay professional.
How to sequence outreach
- Week 1: Top 20% of clients, personal call first, paperwork second.
- Weeks 2–3: The next tier, by phone where possible.
- Weeks 4–6: Remaining clients via call, email, and packet.
Aim to repaper 80–90% of revenue inside the first 60 days. Firms with a clear plan routinely hit that.
Your first 90 days as an independent.
The transition itself is a sprint. The first 90 days after is when you build the firm you actually want to run.
What to focus on
- Finish the repaper. Anything still open at day 60 needs a personal call from a partner.
- Stand up the cadence. Review meetings, planning cadence, and service standards, written down, calendared, owned.
- Close the operational gaps. Anything you flagged during onboarding as "good enough for now," fix this quarter.
- Run your first compliance review. Even a light one. Better to find issues now than at the SEC exam.
- Restart growth. Referrals, COIs, content, whatever your engine is. The transition pause is over.
Thinking about making the move?
If you'd like a confidential walk-through of how AFS handles compliance, custody, technology, and the transition itself (including your numbers under the 90/10), we'd be glad to talk.
This guide is for educational purposes only and is not legal, tax, or compliance advice. Always work with qualified counsel and a CCO when planning a transition.