The 26 Steps I Took To Set Up And Launch My Own Independent RIA

How I Built my Independent RIA Firm (After Transitioning From Merrill Lynch)

Following the publication of my previous article, Advisor Platform Comparison: Wirehouse vs. RIA Aggregator vs. Independent RIA, where I shared my perspective on what it’s like working as a financial advisor under each, a number of advisors from around the country have reached out.

The most common requests have been either: 1) Aaron can you help guide me through the process I need to take to start my own independent RIA Firm?; 2) Can you help me evaluate some of the firms/platforms I’m looking at?; or 3) Which technology providers should I be considering as I go out on my own for different practice management needs such as financial planning software, performance reporting, CRM? Understandable questions, because there really is a lot to consider. Personally, I counted over 40 unique tasks taken to build my RIA practice into what it is today.

As the volume of inquiries about my business has grown to a fairly sizable number, so did my interest in sharing the story of my own journey to independence. How I made the transition. How I actually set up my independent RIA after breaking away from Merrill Lynch (and managed to retain 100% of my clients). How I’ve grown my business over the past year in ways I didn’t see possible while working at predecessor firms. And what tools and technology I used to build my practice from scratch.

Although what I hope you’ll obtain from reading this is much more than just a list of the technology and infrastructure tools of my RIA firm. Because while this is the list of services and providers that made the most sense for my particular practice, I wouldn’t advise you to put this list on autopilot without considering the type of practice you run, your client base, services offered. This is far from a one size fits all business. Though at least this list should be a helpful starting point.

My hope is that, no matter where you currently practice, or your tenure in the industry, you’ll find valuable insights from this entire transition story and experience. Whether you’re at a wirehouse, RIA Aggregator, or a Fintech company providing financial planning, or even a new entrant looking for the right business model to build your practice, you can leverage my experience to give you direction.

And if what’s speaking to you is the idea of starting your own RIA firm, or financial planning practice, please, I implore you, don’t go at this alone. What I would have paid for some hand holding and direction…hours of frustration and dollars saved that could have gone towards revenue producing activities and work that clients actually see. Leverage an experienced professional in your network! Reach out for help! Find a mentor!

So now that you’re primed on what I’ll be covering, let’s dive in, and start with day 1 of my transition from Merrill Lynch to independence.

The Process Of Breaking Away And The Broker Protocol

Breaking away from a wirehouse can be a sensitive issue. From what I’ve seen, if you leave Merrill Lynch and move to a competing wirehouse, especially Morgan Stanley, they make the moving process very difficult for you—and word spreads fast. And this will likely only be worse now that UBS and Morgan Stanley have left the Broker Protocol.

Fortunately, my understanding is that the regional wirehouse managers know each other fairly well, and accept the fact that teams occasionally move from one firm to another, especially when advisor contracts expire. It’s just a part of doing business. As long as the advisors follow Broker Protocol and don’t start a smear campaign against their prior firm in order to win clients, the moves usually happen without any need for litigation/legal action. I will say that if an advisor leaves on bad terms, the management team WILL take it personally. I saw this when one of my younger colleagues left Merrill and moved to Morgan Stanley, in the same building!

Knowing this in advance, I kept my future plans of starting my own firm private, and when my manager asked what my future plans were, I told him I was planning to take a little time to figure it all out. Which was accurate considering I left Merrill on November 30, and my firm, Rapport Financial wasn’t officially registered with the State of California until Jan 19. In fact, my manager wished me a Happy New Year! I might be reading too far into this, but they probably checked the ACATs and saw the contra firm was TD Ameritrade, an independent custodian, and figured that either the clients decided to go with a self-directed option (less likely), or an independent advisor clearing through TD Ameritrade.

My reputation in the business community is so incredibly important to me, and I’ll admit, I made some mistakes early in my career that I plan on not repeating. So, I knew what not to do when leaving Merrill. It’s also way easier to exit on good terms when you’re leaving on your own accord rather than being fired without notice. I made sure to thank all the support staff, management team, and my hiring manager for the opportunity he provided me.

Although if you’re planning to break away, and take your clients with you on the spot, it’s definitely important to get guidance from a competent attorney on exactly how to comply with the Broker Protocol.

Getting My Clients Back With My New RIA

Most of my clients had my personal cell number already, and called me after I left Merrill. It also helped that I didn’t have 50 or 100+ clients, and thus could focus my efforts on building incredibly strong relationships to where my clients associated their accounts with my stewardship, not the institution I worked at.

When I left, several of my clients were immediately assigned to other Merrill advisors, who did try calling them to establish a relationship. But my clients insisted on working with an advisor they like, and more importantly trust. To give you an idea, some of my clients have moved their accounts with me several times since I first entered the business in 2010 at the ripe age of 22. If at all possible, though, I’d like to make this the last move for my clients.

I took the high road when I spoke with my clients. Explained why I had left Merrill and decided to start my own independent advisory firm after 7 years in the business. That I would be able to provide more customization, better technology and an overall better service offering to them. That I was experienced and prepared for the task at hand, and welcomed the opportunity to continue our working relationship. I refrained from smearing Merrill, but accurately pointed out some of the flaws in Merrill’s model. In some cases, I revised a client’s fee schedule lower as a token of gratitude for moving with me.

I didn’t wing these phone calls. I had diligently prepared my message for quite some time, and it proved effective in that I was able to bring 100% of my clients with me.

The Details You’ve Been Waiting For: Step By Step Of How I Set Up My RIA

Step 1: Do your homework!

Time: Anywhere from 3 months to a number of years depending on your experience and comfort level.

Before resigning from Merrill Lynch, I had done a significant amount of the legwork to prepare myself for the transition to independence. Full disclosure, I did have the benefit of previously operating as an advisor in the independent advisory space for a fully independent RIA, and an RIA Aggregator, so this process wasn’t entirely new for me. That is not to say the process was seamless and without a steep learning curve.

When you first explore the idea of starting your own independent RIA Firm, please… I implore you, DO NOT RUSH. Don’t get impulsive or impatient. Spend the necessary time conducting research so you have a solid understanding of what is essential to succeed as an entrepreneur, business owner, and independent financial advisor.

I cannot emphasize enough, the importance of preparation and research! Of course, with any new business venture there are going to be things that come up that you don’t anticipate. But there are things you can do in the preliminary stages to lighten your workload so you don’t feel incredibly overwhelmed from what will be a very stressful and life changing experience. Follow these steps, and you’ll find yourself on the right path.

While at Merrill, I knew there were activities I couldn’t legally undertake while still employed by the firm. For instance, I couldn’t alert clients about my plans to move before officially resigning. But this didn’t entirely prohibit me from getting a head start with planning my eventual exit.

First, I made a list of websites to explore, and visited them regularly to bring myself up to speed on the general infrastructure used by most independent RIAs. Reading Sophia Bera’s Setting Up An RIA and Starting a New Financial Planning Practice on Less than $10,000 served as a great resource for me—although I run a practice that looks very different on paper. But this gave me the confidence that I had the savings necessary to bootstrap without having to raise outside money.

Step 2: Name your company

I decided not to go with my initials or last name as the name of my business, because I envision building a larger financial brand from the name “Rapport.”

One of the websites I found particularly helpful in jumpstarting the exercise of naming my firm was from a financial advisor coaches website I found online.

And then I found a name that best encapsulated the relationship I have with my clients: Rapport. I did a variety of different searches to ensure that the name “Rapport Financial” wasn’t already taken.

If only I could somehow convince Gartner to sell me the rights to for a reasonable price…

Step 3: Determine your Business Legal Structure and incorporate

I used Legalzoom to form a Single Member LLC for my advisory firm.

Do yourself a favor and go with the Express Gold Option—not the Economy or Standard packages offered by Legalzoom. Especially if you’re in a rush to get incorporated!

While the Economy package is reasonably priced at $149+state filing fees, you’ll end up having to wait 30 business days to get your operating agreement, financial account authorization letter, and File Articles of Incorporation with the Secretary of State. Spend the extra $210 for the faster turnaround time offered by the Express Gold Option. Plus, with the Express Gold Option, you end up saving $30 on the application for your Federal Tax ID (EIN) so the difference is actually only $180.

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The reason this matters is that several of your next steps will be delayed if you’re waiting 30 days to get your business entity in place. Looking back, I would have gladly paid the $180 to prevent delays in opening a business bank account, credit card, and, more importantly, beginning the process of filing as a registered investment advisor with the State of California. Spend the extra few hundred dollars to avoid downtime, which may result in lost revenue and opportunity.

If you have the money, you may want to hire a lawyer who can help determine the appropriate legal structure for your business, as the benefits of LLCs vs partnerships vs S corporations are beyond the scope of my discussion here. And you’ll likely want a compliance attorney to help with the drawing up of your investment management agreements and other legal documents, anyway.

I’ll admit, having an attorney would have helped me incorporate a bit quicker to avoid any lag between my employment with Merrill Lynch and having my firm registered with the state so I could legally conduct business as an investment advisor.

Step 4: Set up a Business Banking Account

You’ll need an employer identification number (EIN) which you obtain directly from the Secretary of State in order to establish a business banking account.

I set up my digital (online) bank account with Capital One Spark. Because really, in today’s world, I doubt you’ll ever need, or want, to go into a bank branch. However, if you feel more comfortable walking into a physical bank branch, they do have ample locations available.

Key Features: No monthly transaction limits, monthly service fees, or minimum balances. 1.00% APY for the first 12 months on Business Savings.

Step 5: Apply for a Business Credit Card(s)

For me, choosing a business credit card came down to a combination of the following:

  • Startup and recurring monthly expenses.
  • Categories of expenses.
  • Annual Fee
  • Signing Bonus Offer
  • Great customer reviews
  • Credit Card review websites

My objective was to find two cards, the reason being, if one card was breached or experienced fraud, I would have a backup on hand for day-to-day purchases. I wanted an AMEX Card for purchase protection, extended warranty, rental car insurance collision benefits, and their outstanding customer service.

I started by googling, “best small business credit cards” and read reviews from ThePointsGuy and NerdWallet. After conducting sufficient research, I chose the AMEX Business Gold and Capital One Spark card.

AMEX Business Gold Rewards Card

The AMEX Business Platinum card is better for businesses with higher monthly/annual expenses, but with the $450 steep annual fee, didn’t make a lot of sense for my business.

You can read up on the further details of this card on the website, but here are the key figures:

  • $0 introductory annual fee for the first year, then $175/year
  • 50k membership reward points after you spend $5,000 in qualifying purchases within your first 3 months of Card Membership
  • 3x points on computer hardware, software, and cloud computing purchases made directly from select providers
  • 2x points on airfare, advertising, gas stations, shipping
  • 1 point per dollar on other purchases
  • Premium Roadside Assistance
  • Purchase Protection
  • Extended Warranty

Capital One Business Spark Cash

The Capital One Spark Cash for Business made sense for my business for three key reasons: 1) the 2% cash back on all purchases; 2) Lucrative cash bonus upon spending $4,500 within 3 months of account opening; 3) I already had my business banking account with Capital One! And they had a low annual fee.

You can read more about this card on their website as well.

Step 6: Select an Accounting Management System

QuickBooks, at a cost of just $10/mo., was recommended by my accountant, Ron Meyers and other small business owners.

Step 7: Hire an RIA Compliance Company to help with your registration/ADV Filings.

With your business entity and bank accounts in place, now you’re ready to submit your firm’s registration to the State/SEC depending on your AUM. There’s no looking back from here!

I would strongly recommend hiring a compliance firm to help with drawing up your Forms ADV 1A/1B, 2A/B and helping you through the registration process. Especially with respect to the timing of when you actually file for registration, which may notify your existing broker-dealer and make them aware you’re leaving (and in turn can accelerate your departure as a termination!).

You could potentially do this yourself. In my opinion, it’s not worth the risk. Hire a compliance firm that’s experienced and has done hundreds if not thousands of RIA firm registrations.

RIA in a Box publishes great content and provides a number of resources for free. Definitely recommend you download some of their lists and guides as references so you’re up to speed on the registration process.

I contacted 3 firms, several recommended by my custodian, and ended up selecting NCS Regulatory Compliance:

NCS Regulatory Compliance

Cost: $3,825 which includes registration and 1 year service of Level I compliance.

NCS Regulatory Compliance has over 900 Investment Advisor clients, and is a well-established company in the compliance industry having been in business for over 25 years. Similar to my process in selecting other services, I called and spoke with 3 different compliance providers to ask a series of questions, followed by a Request for Proposal (RFP). Key questions I asked in the RFP process included:

Service Offering and Expertise

– What is their expertise? – How responsive are they in communication? – How easy and intuitive is their website? – Do they regularly publish and distribute helpful content to users?

Business Specifics

– How long have they been in business? – How many clients/firms do they work with? – How are they different from their competitors? What’s their edge? – What are their strengths, and where do they see their weaknesses? – Have they worked with clients similar to you? – What is their reputation? – What is the background of the team you’d be working with?


– What are the fees? – Are they transparent about their fees? – Do they have various packages? – How long is the required commitment period? (E.g., 1-year term required? Shorter? Longer?)

Ultimately, I signed with NCS Regulatory Compliance. And I’m so glad I went with them! I was assigned a Senior Consultant, James Slabaugh, to manage my ADV filings, provide professional templates of financial planning and portfolio management agreements, and application for registration as an Investment Adviser with the California Commissioner of Business Oversight through the Investment Adviser Registration Depository. Generally, Registered Investment Advisory firms like mine with less than $100 million in assets under management are required to register with the relevant state regulatory authority, rather than the SEC.

James has been an absolute pleasure to work with during the registration process, and my subsequent compliance needs. James has repeatedly made me feel like an important client to both him and the team at NCS.

Step 8: Purchase a Domain Name

For a mere cost of $0.99 for the first year, I went with 1and1.

There are other options including GoDaddy that also do the trick, and lots of tips out there on how to pick the “best” domain registrar.

I went with 1and1 because a domain name is only $0.99/for the first year, and they include private domain registration for FREE. This keeps your personal information from being made publicly available to solicitors. You’ll definitely want this. Otherwise you’ll find yourself with hundreds of emails from digital marketing agencies, website developers, etc. I found that many of the domain registrar competitors charge an additional fee for private domain registration.

Step 9: Set up Your Business Email Account

I set up my business email account with Google G Suite, which has a base cost of just $5/month.

Make sure you purchase the domain name associated with your business before you set up your business email. Google requires you to verify ownership of your domain prior to buying an email with your company name.

For example, my email is [email protected]. But I had to own before I set up my business email account(s).

Step 10: Select a Web Hosting Service and Build Your Website

I decided to buy a WordPress hosting package at a cost of $51/year for the first two years through Hostgator.

Hostgator was one of the higher rated affordable host providers for WordPress.

Once you’ve selected your website host, find a competent WordPress/website developer, on either the freelancing website Upwork, or through your network. Make sure to interview a few candidates, ask for samples of their work, and obtain a few quotes to gain a good sense of what the website build-out process will look like (and what it may end up ultimately costing you).

A technical friend helped me define specific filters on Upwork, making it far easier to narrow down the field of candidates to a select group of affordable, proven, talented website developers. The primary filters I used were:

– English Level: Fluent – Earned Amount: $100k+ – Job Success: 90% and up – Hours Billed: 1,000+hours billed – Last Activity: Within 2 weeks – Tests: I’d list WordPress, CSS/HTML, Front End Development and any other skills you want the freelancer to have in order to build your website. You can go further with this filter and even narrow down to candidates that have performed well in the aptitude tests provided by Upwork. For example, when listing the skill, “WordPress” you can narrow this to candidates that have scored high on the test, i.e., top 10%.

Step 11: Choose a Primary RIA Custodian

I conducted research on several RIA custodians before I selected TD Ameritrade Institutional as my primary custodian. And they won because at the end of the day, they put forth the greatest effort to win my business, and provide an incredible suite of technology for independent advisors through their VEO One platform. Although I had previously custodied hundreds of millions in client assets with Fidelity and Charles Schwab at my prior firms, both were unable to accommodate my practice based on the initial size of my client book (assets under management) on day 1.

TD Ameritrade Institutional offers a combination of great service, innovative technology, many integrations with third parties, and resources that have made it possible for a sole practitioner like me to run an entire wealth management practice. They also have a stellar reputation in the investor community.

Step 12: Hire a Designer for your Company’s Logo

I used 99Designs to do my logo design (cost varies by package selected), although my first design brief didn’t work out as planned.

I called the customer service department, spoke with a representative, and expressed my desire to cancel my project brief and be issued a refund. What transpired next came as a complete surprise. The representative reviewed my account and then made specific recommendations tailored to my project brief. She provided valuable insights and constructive feedback, acting in more of an advisory than sales capacity. Sales representatives, take note! What this representative did was far different than other sales representatives I’ve dealt with in the past. More often than not when I’ve canceled services I’ve been matched with a customer service representative that simply processed my cancellation request, making no effort to overcome objections or prod further to figure out where things went wrong.

This very talented representative and the 99Designs team rightfully earned a second chance to win my logo design business. By providing quality actionable advice, and not rushing to cancel my plan (which would have been the easy way out), 99Designs turned what could have been a lost customer into a success story that produced a winning logo design that I’m very happy with and you’ll find on my website for Rapport Financial.

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Step 13: Purchase Business Cards

I was looking for a simple, clean, and high-quality business card that I’d be able to hand to interested parties. Moo has a great reputation, and although they’re not the cheapest (cost varies with exact product selected), like its competitors they often run promotions, so wait for a sale if you can!

For further options, here’s a top 10 review I found of the best business card printing services online.

Step 14: Trademark Your Company Name

It cost me $635 (including the USPTO application fee and the attorney fee) to trademark my company name with Upcounsel.

I originally reached out directly to a few attorneys I knew at larger law firms, but found the minimums to be way out of my price range. For a bootstrapped entrepreneur on a budget, I found Upcounsel to be an effective service that enabled me to protect the IP of my firm at a cost I could afford.

Step 15: Buy a Health Insurance Policy

If you’re going out on your own, you walk away from traditional employee benefits, including not only a 401(k) plan (which you can create for your own business later), but health insurance. Fortunately, state insurance exchanges make it possible to get health insurance without underwriting restrictions, even if you’re not able to get coverage through your new small business.

Warning: This will be one of your largest expenses.

In California, depending on your income, you may qualify for up-front tax credits when you enroll in health insurance in California through the Covered California Health Exchange.

Ultimately, I worked with Barry Sikov and his team at Belair Insurance Services to help me find a health insurance policy through the Covered California exchange. I wanted a policy with a reasonable deductible and affordable monthly premiums. Barry asked me a series of thoughtful questions that led to the selection of a policy that best addressed my current health insurance needs.

You also should know that even with coverage obtained through a state insurance exchange, you can work with an insurance agent, and there’s no additional cost to doing so (as a small layer of health insurance commissions are built into all health insurance policies, regardless of where you buy it). I know Barry on a personal level and can attest to his professionalism, knowledge and care.

Step 16: Buy an Errors and Omissions Insurance Policy

I purchased my initial RIA E&O policy through Napa Premier for $952/year.

Napa has a preferred rate program that I qualified for because I’ve never had a customer complaint filed with FINRA. This made the E&O policy from Napa the most affordable policy I came across during my search process.

I recently found out that by being an FPA member I qualify for an even lower rate. If you’re a CFP certificant or carry other industry designations, you may qualify for a lower rate as well.

Step 17: Find a CRM offering a variety of integrations

I signed up for the basic version of Wealthbox, which costs $35/mo. (They also rolled out a Premium offering to advisors with a higher monthly cost.)

Wealthbox integrates seamlessly with my business Gmail account. Anytime I send emails to a contact, I simply click a box in Gmail, “Save to Wealthbox” and the email is then automatically added to the activity log for the contact in Wealthbox. This email syncing process became easier with Wealthbox’s rollout of an upgraded Wealthbox Mail offering in January.

It’s a modern CRM with an intuitive user interface, similar in design to Facebook. It’s been really easy to find what I’m looking for, whether I’m adding new contacts, logging meeting notes for a client, or setting tasks at the client level.

Wealthbox also integrates with a wide list of industry solutions, including Blueleaf, Mailchimp, MoneyGuidePro, RightCapital, Twitter, TD Ameritrade, and more.

Wealthbox is offering readers of this article a limited time 30% off their first paid month when using the referral code “Aaron.”

Step 18: Select an Email Marketing Service

I set up my email marketing with MailChimp, which was appealing in part because it’s free for your first 2,000 subscribers (across all lists in your account)!

And as noted above, MailChimp integrates seamlessly with my CRM provider Wealthbox. And is easy to use itself.

Step 19: Select a Consolidated Performance Reporting Provider

I use Blueleaf for performance reporting, although it is more than just a consolidated performance reporting system. They’ve coached me time and again on how to best utilize their software and team in order to win new business. Thanks to the team at Blueleaf, their reporting system has become an integral part of my prospecting strategy (and not just for giving performance reporting to existing clients!). In addition, the team is always responsive and helpful when I have any questions or constructive feedback on ways to make the platform better for advisors.

Blueleaf offers a number of partner-level integrations with some of the leading providers in analytics, reporting, CRM, and Financial Planning.

Pricing for Blueleaf varies by the number of households that are aggregated.

The team at Blueleaf is offering 2 free months to Nerd’s Eye View readers who sign up for a 1-year subscription.

Step 20: Select a Client Billing (Invoicing) System

Billfin is a simple, cost-effective ($99/month for your first 150 clients) cloud based billing software that has partner-level integration with both my performance reporting system, Blueleaf, and my primary custodian, TD Ameritrade.

There are so many attributes to like about Billfin:

  1. Ability to bill on client assets held with other custodians
  2. Flat, Tiered, and banded AUM fees
  3. Bill in advance, in arrears, or average daily balance
  4. Easy to set up asset exclusions by household, account, asset class, and or individual securities
  5. Creates simple CSV/Excel files to upload to the custodian’s billing system
  6. Customizable, professional-looking invoices that are clear, accurate and have my company logo
  7. And last but not least, an outstanding customer service team!

At prior RIA firms, we used Excel spreadsheets for calculating quarterly billing and generating invoices. But this is both time-consuming and cumbersome with different fee schedules, clients joining your practice mid-quarter, prorated billing, etc. What I really like about Billfin is that once it’s all set up and you learn the user interface, you’re no longer wasting hours calculating client management fees and generating professional-looking invoices.

Step 21: Purchase a Cloud Document Storage Service

Dropbox is popular for individuals to manage their own personal files, but there are multiple subscription offerings for Dropbox. I originally went with the Business Advanced Plan (and selected to be billed annually, instead of monthly, which saved 20% off the list price). But I’ve since re-evaluated my cloud storage needs and downgraded to just Dropbox Professional (which costs $199/year)—at least for now.

Most of my clients are Dropbox Personal Users, and have familiarity with the platform, so this choice originally made the most sense of the cloud storage options available. Unfortunately, the Dropbox Business Advanced Plan requires you to purchase a minimum of 5 licenses, which combined adds up to a pretty significant annual expense of $1200. For a solo practitioner like myself, this is quite cost-inefficient.

Running a business is definitely a learning experience!

Here’s a list of The Best Cloud Storage and File Sharing Providers for Businesses in 2017 that I used to help with the due-diligence process.

Step 22: Select a Social Media Compliance Archiving Provider

I evaluated a few compliance archiving solutions, but was most familiar with Smarsh from my days at HighTower. I reached out to three different vendors to obtain quotes. To my surprise, although Smarsh is one of the most well-known providers in this space, they came through with the most affordable solution to meet my social media archiving needs.

I went with the archiving core platform monthly starter package at $60/month, and added the social bundle monthly package which ends up costing an additional $4/month for each social media platform: Facebook, Twitter, and LinkedIn.

Step 23: Find a Client Presentations/Portfolio Analytics and Optimization Software

Kwanti costs just $80/month (although I was able to get it slightly cheaper with a no-longer-available TD Ameritrade discount), and it integrates with both my performance reporting software, Blueleaf, and my primary custodian, TD Ameritrade. They also have integrations with: Advyzon, Black Diamond, Fidelity, Charles Schwab, Orion, Portfolio Pathway, Redtail, Riskanalyze, TradePMR, and more in the works.

As you can probably tell, integration of software providers is an important theme in my product and vendor selection—and it should be for yours when you set up your independent firm. When you’re building your firm, you need to have your outside software providers communicating with each other.

The data Kwanti uses comes directly from Morningstar, so I can be confident in the outputs. I use Kwanti to build my portfolio models, which vary based on my client’s risk tolerance and time horizon. The reports I’m able to generate using Kwanti are both visually appealing, and provide in-depth analytics I rely upon to construct high-quality, efficient portfolios for my clients.

Kwanti is offering readers of this article a limited time 30% off their first paid month when using the referral code “Aaron”.

Step 24: Purchase a Financial Planning Software

Cost: $100/month with annual commitment after discount.

Right Capital

I originally went with a financial planning software that was the preferred provider at HighTower Advisors, MoneyGuidePro. I found MoneyGuidePro to be an effective planning software for my clients over the age of 50 – those clients who are often more established in their careers. These are individuals with dependents, estates, multiple income streams, and far more interested in goals-based financial planning. For this, MoneyGuidePro was a solid planning solution.

However, I started noticing a few problems with MoneyGuidePro, namely the lack of an emphasis on cash flow planning, and the ability for clients to track their spending habits in real time, similar to the function performs.

Accordingly, I decided to switch to RightCapital’s financial planning solution (at $100/month with an annual commitment) because my younger clients (those under the age of 50) are looking for a financial planning experience that emphasizes cash flow planning, budgeting, and tracking their current finances, without being bombarded by credit card, personal loan, and other financial product solicitations (Mint). Right Capital integrates with Blueleaf, so when my clients plug in all their accounts to Blueleaf, the data feeds seamlessly into RightCapital’s Planning Portal.

My clients that currently use Right Capital rave about its functionality, features, and the fact that it’s so easy for them to use!

Step 25: Join Industry/Professional Service Groups

I’ve been advised by a number of professionals in service businesses to be actively involved in the community. Whether it’s volunteering on non-profit boards for causes you’re passionate about in your local community, or joining industry groups in your professional community (or better yet, a combination of the two), staying active in the community is absolutely necessary in order to grow your brand and business. And this is even more important when you’re not affiliated with a large firm with a household name.

I’m currently working on building out the Rapport brand through a number of strategic outreach efforts. I recognize that not everything I do will end up working. But I’m confident that only good can come from being generous with my time and knowledge of personal finance, publishing helpful and actionable content, and now teaching others how to successfully start and operate an RIA firm.

I’ve recently joined the Financial Planning Association of San Francisco, and see several benefits from joining industry/other professional networking groups:

  1. Meet your future business partner
  2. Meet an advisor nearing retiring and interested in succession planning
  3. Find a mentor
  4. Learn from your peers about emerging trends, different business models in the industry.
  5. Network with fellow practitioners and build strong alliances.
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Finally, I’m also a huge proponent of attending conferences related to your target clientele and their interests. Many of my clients share common interests, which is how we build Rapport. This allows for us to have conversations that are meaningful and go beyond investment advisory and financial planning.

Step 26: Find a flexible and fun Office Space

I absolutely love my WeWork office! It beats the alternative—working from home in isolation or in a crowded coffee shop. WeWork offers different plans based on your office needs:

  • On-Demand/We-Membership
  • Hot Desk
  • Dedicated Desk
  • Private Office

I chose the dedicated desk plan in order to have a home base (besides my own home!) in a quiet space. A dedicated desk is a permanent desk that includes a lockable filing cabinet to store my important client files. And at $600/month, it’s a lot cheaper than trying to rent out a standalone traditional office space (since I ultimately only need to do a few meetings per month there)!

With 211 locations across 52 cities and growing, WeWork has office locations around the globe. I happen to have clients outside of California, and love that I have the ability to meet them at WeWork offices in their home cities. It’s as simple as booking a 1-day pass for another office for 1 credit, or booking a conference room in 30-minute increments for 1 credit through the mobile app. The dedicated desk membership comes with 5 credits/month. And it’s a month-to-month lease, so you don’t have the burden of a long-term lease to deal with. I really appreciate this flexibility as a bootstrapped entrepreneur on a budget.

As a sole practitioner, I can also appreciate the community at WeWork. Having other people around to collaborate and share ideas with is a luxury. Think of WeWorkers as your colleagues that aren’t in direct competition with you for that coveted promotion!

Finally, you can host events for free at WeWork as a paid member. The spaces are beautifully designed with ping-pong and other gaming tables, beer and cider taps, coffee… need I say more? Don’t tell everyone about the free beer, though. Friends will make every excuse to come visit you for happy hour!

Looking Back After 1 Year

Now that I’m coming up on the 1-year anniversary of starting my Firm, I’m taking time to reflect upon the decisions I made in putting this whole offering together, and the rules I diligently followed in interviewing and selecting technology and service providers. And, as I recently met with my accountant/bookkeeper/business strategy consultant, Ron, we underwent an activity that I would encourage every business to take at the 1-year mark: go through each and every expense, (re-)evaluate the service and its efficacy, and whether there may be better alternatives.

Personally, I actually cut several expenses entirely from my operating budget now, because when I was getting started I had to make a lot of gut decisions and move on to the next task, but now I see the expense was/is no longer necessary. This is not to say I was impulsive or reckless in selecting service providers or infrastructure for my business, however, I had limited time and, in some cases, had to make decisions resulting in annual financial commitments. Now that there’s time to look back, some cutting is possible, especially as it’s critical to reach breakeven profitability in the early stages, and I have my own short-term goal of being able to support myself with a livable wage. It hasn’t really helped being in San Francisco, arguably the most expensive city in the country, but I’ve built a life here, love my clients and the community I have, and recognize the opportunities that exist here with the booming tech industry.

In my case, the changes that I’m making now at the 1-year mark include…

1. Evaluating all of my expenses and negotiating with service providers where possible.

When you’re starting out, it’s difficult to spend a lot of time going back and forth on everything you need to run your business. But after 1 year in operation, and gaining your sea legs, it’s much easier to have conviction as far as what’s absolutely critical to run your practice.

I’m also in the middle of reading “The Lean Startup” by Eric Ries and the main takeaway is to be more budget conscious with my business expenses.

2. Diversifying Income Streams.

Most traditional wealth managers bill quarterly on the portfolio assets. This can create cash flow challenges for someone used to receiving a regular paycheck. My business model has adapted and eliminated this problem. There are now 3 different ways a prospective client can work with me:

I. Full-Service Wealth Management Subscription: % of assets.

This is geared towards individuals and families with in excess of $250,000 of investable assets

II. Financial Planning Subscription: Flat monthly fee.

This fee ranges based on the complexity of the client financials, similar to the SaaS fee model. This is geared towards high income earners that aren’t rich yet, (H.E.N.R.Ys) meaning they’re not yet at the 250k mark (my minimum), requiring help with a variety of personal finance issues including: retirement planning, budgeting, asset allocation, evaluation of investment opportunities, stock options planning, and so on.

III. Hourly Financial Planning.

For some situations, I’ve found it makes sense to work with a client on an hourly basis. This isn’t my preferred model, because I am not a transactional professional and prefer to build long-term relationship with my clients. It is typically best for one-off stock options reviews/divesting strategies, or second-opinion portfolio reviews for DIYers, where I can demonstrate the inefficiencies in the client’s current portfolio and have them implement the changes. What I often find is that busy professional DIYers end up eventually becoming full service wealth management clients because they find managing their own finances to be a distraction and too much to handle when life gets in the way. This holds true during corrections and periods of volatility when a professional advisors care and guidance is even more valuable.

For this arrangement, I either use my clarity account (for virtual meetings) or ask that interested parties book time directly on my website to schedule an in-person meeting.

Building fee only full-service wealth management relationships takes a considerable amount of time and patience. Which is why the monthly planning model, hourly rate, etc., can supplement income and make up for the gap in earnings while I’m growing my wealth management business to where I can earn a decent salary.

3. RIA and Practice Management consulting business for advisors.

Industry trends point to continued RIA growth at the expense of wirehouses. Morgan Stanley and UBS recently dropped out of the Broker Protocol, making it harder for an advisor to move firms without the risk of a temporary restraining order or lawsuit.

Most of the advisors I’m speaking with prioritize autonomy over compensation. They see the many long-term benefits of transitioning to and operating within the RIA model.

Since starting my firm, Rapport Financial in January of 2017, I’ve been able to work with a few advisors exploring a transition and wanting to review their options. In some cases, it made sense to join an RIA Aggregator. In others, starting their own independent firm and leveraging the infrastructure and operations of an already established name brand worked. And for some advisors, it really didn’t make sense to leave the wirehouse they were working at.

I’ve now operated an advisory practice within several advisor platforms, and witnessed firsthand what a successful advisor looks like in each model. And as my practice has evolved and grown over the past 8 years, I’ve gone through the exercise of conducting deep due diligence on advisor platforms in order to determine the best one for the particulars of my business.

4. Breaking down all my operational expenses and determining the cost per client.

This helps me understand what my minimum fee needs to be in order to break-even on a full-service wealth management client. This currently doesn’t factor in my labor costs. As I continue to scale and add new clients, and with many of my costs fixed, this cost per client figure will drop.

5. Varying the daily routine.

I’m making a habit of having lunch at friends’ offices and not spending every day at my WeWork desk. Occasionally, on a dreary San Francisco day, it’s nice to work from the home office. I’ve also found, as a general rule of thumb, you don’t want to get too comfortable in this business.

6. Scheduling bi-monthly calls with my bookkeeper/accountant/strategic business advisor.

7. Implementing payroll and taking a quarterly distribution/income from the LLC.

8. Being more aggressive with prospecting and asking for referrals from existing clients and network of professionals now that I’ve crossed the 1-year mark.

The best analogy I could come up with is comparing the 1st year of a company to the 1st year of a new car model. This rule of thumb can actually be applied to almost any form of technology. Advancements and improvements occur annually and often at a rapid pace. I look back at the first-generation iPhone and it’s truly incredible how much the product has advanced over the past decade.

When people choose to work with a financial advisor, they’re not going into this thinking they’ll switch providers every year or even every few years. Wouldn’t that be an absolute nightmare? The amount of paperwork. Onboarding process. Building rapport. So, for a decision this important, it doesn’t come as a surprise to me that like with anything in life you have the early adopters, then as your business matures, and there’s less risk associated with the company, more people are interested and willing to work with you. I get it. Having more clients is attractive to a prospective client. It shows that you’re experienced, and less likely to make mistakes on their account(s).

My business has grown so much over the past year that I now finally feel confident in approaching affluent and larger prospective clients to show them an offering that rivals what they’ll find at mature financial institutions.

9. Looking for Mentors.

10. Schedule a minimum of 1 networking/learning event per week.


Yes, this is a LOT of work! Again, I absolutely wish I could have hired a professional to guide me through this process of starting my own independent RIA firm. Someone that had the expertise and deep operating knowledge necessary to help me go through the very step-by-step process I took in starting Rapport Financial. Help with avoiding unnecessary expenses and keeping startup costs low. With constructing a personalized and comprehensive plan, curating the right technology offering, service providers, business and marketing plans, and organizing the infrastructure to prevent any disruptions during a risky transition process from your old to new firm. Similar to the advisory role we perform as financial planners for our very own clients!

For many advisors, their core competency is advising clients, enhancing existing relationships and performing activities that help them in acquiring new clients. Not running a business and the day-to-day operations of an investment advisory practice. That’s why so many advisors start out at broker-dealers and wirehouses (as they automatically provide the platform for this). But it is something you can do and figure out when you go independent, especially if you already have several years of experience by the time you do (and thus know more about what you want!).

If you’re serious about breaking away and forming your own independent RIA firm, and want to chat further for my perspective, feel free to reach out and schedule time here!

So what do you think? Are you considering breaking away and starting your own independent RIA? Have you successfully navigated the process? Please share your thoughts in the comments below!