Why do advisors choose the RIA model?

Why do some advisors choose to work as an employee for Northwestern Mutual their whole life, some advisors choose to open and build their own registered investment advisory firm, and still others spend their careers working at an RIA instead of owning one?

There’s no one right way for every advisor to create their career, contrary to what many industry pundits will try to tell you.

But while there isn’t a one true path for everyone, that doesn’t mean there isn’t a best path for you.

Where you choose to work, and what type of advisor you choose to be, ultimately comes down to what you value in the workplace and the types of people you want to work with.

In today’s article, we’ll help you identify those things so you can answer for yourself if choosing the RIA model is right for you—or not.

Your Ideal Workplace

Knowing where to work as an advisor requires that you understand what type of work environment is best for you. Do you want to work on your own? How important is competition to your ability to get excited about reaching goals?

Here are three things about the workplace we think every advisor should consider.

  1. Working with a team
    Working on your own versus working in tandem with a group can be an important dynamic to understand. A team environment isn’t specific to an independent firm, but everyone having aligned values and keeping the focus on clients is more associated with the RIA model than other types of financial institutions.
  2. You can focus on clients instead of compliance, trading, and back office tasks
    A team environment can also lend itself better to those advisors who want to do one thing: Give financial advice. When you have the right people around you and the right workplace infrastructure, you can focus on working with clients and hand off the other parts of business. Some advisors, though, like to get their hands into other parts of advisory life, like fee billing or trading.
  3. Flexibility in how you work with clients
    When you work at a wirehouse, there is often rigidity around which financial products you can offer, what your reports for clients can look like, and what your sales pitch needs to be. In short—it’s about transactions, not real relationships. Some advisors still find a way to thrive in this environment, but if you’re someone who needs a little independence, the RIA model is the best career path to follow because you get to choose how to interact with clients and create true value for them.


Your Career Goals

The type of business workplace you choose is one factor; the other is your personal career goals.

  1. You value independence
    If flexibility and escaping the rigid confines of the average wirehouse are at the top of your goals list, there’s no better way to achieve it than by joining an RIA. An RIA firm tends to be a small-to-medium size business, which can be an appealing change of pace from the red tape lifestyle of a large corporation. If your goals involve taking more control over your career trajectory and being the one in charge of how high you can reach, there’s no better business model than an RIA for advisors.
  2. You want to collaborate instead of compete with other advisors
    Wirehouse representatives are trained to compete with each other. Clients could be won by you or someone else at your organization, and if you want to get ahead, you have to be the one to close the deal. On the other hand, independent advisors band together for resources and camaraderie. The business environment is all about doing what’s best for clients, and that extends to sharing knowledge and tips with other hands, whether they’re at the same firm or completely different businesses.

  3. You want to align with a trusted brand that puts customers first
    Wirehouse firms may have known names—but they aren’t always trusted. In fact, one consumer survey found that 24% of respondents identified PayPal as their most trusted financial brand—which was more than double the nearest bank’s trust in the responses.


RIAs, on the other hand, are outside the Wall Street financial institutions. They’re more about Main Street, and client retention rates reflect the trust that most clients place in their financial advisor. In 2020, retention rates across the industry were nearly ninety-five percent.

The numbers make it clear. If you want to build your career alongside trusted brands in communities (like, for example, WealthPlan Group), the RIA model can scratch that itch.


Ready to make your move to working in an independent advisory firm? Click here to talk with WealthPlan’s transition experts and see what an RIA career could mean for you.


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