Building Your Own RIA Will Not Give You Your Time Back
There is a difference between owning your business and running your own RIA, and most advisors don't separate the two until they are already committed to one.
I understand how advisors get there. You picked an independent platform because it was entrepreneurial, flexible, and built around people like you. Then the organization grew. More layers, more centralized decision-making, more standardization. The things that drew you in started to thin out. At some point, the conclusion feels obvious. If the platform keeps drifting, take everything in-house and control it yourself.
That instinct is not wrong, but I think it is aimed at the wrong problem. Control and ownership are not the same thing, and the move that buys you more control will often cost you more of everything else.
You are not alone in the instinct, either. Cerulli found that nearly a third of independent broker-dealer advisors had considered opening their own RIA within the past year, and that advisors weighing a breakaway generally prefer launching their own firm over joining an existing one. So this is the majority reflex, not a fringe one.
Owning the RIA Means Owning Everything
When you build your own firm, you are responsible for compliance, technology, billing, cybersecurity, vendor management, and operations. The buck stops with you on every one, and several of them will be unfamiliar.
The cost is real, and it is documented. Cerulli found that 84% of RIAs identify compliance as a major challenge. Ongoing compliance consulting generally runs eight to fifteen thousand dollars a year, and an outsourced chief compliance officer arrangement runs anywhere from thirty thousand to a hundred and twenty-five thousand annually, depending on the size and complexity of the firm.
Here is the part I find hard to argue with. LPL publishes its own analysis estimating that principals at solo RIAs can spend as much as 40% of their time on compliance-related work, and concludes that for a firm under five hundred million in assets, doing it yourself may cost more than joining a platform.
That analysis exists to recruit fee-only advisors onto LPL. I know that. The math is still correct. When a firm makes a self-interested argument that happens to be true, the right response is to check the math rather than dismiss the source.
Owning the RIA Is Not The Only Path to Freedom
Most advisors evaluate this as a yes-or-no question. The better version is a subtraction problem.
Running your own RIA is not free. In the work I do with advisors, the all-in cost of doing it yourself tends to land somewhere around five to seven basis points once you account for compliance, technology, vendors, and the staff you have to add. That number moves with size and complexity, but it gives you a floor.
Now compare that to what a partner would charge. If a firm wants fifteen or twenty basis points, I am not going to put you in front of them. That gap is too wide to justify. But if a firm is at seven to ten, the real question is narrower and more useful: does a spread of two to four basis points buy enough risk off your plate to be a good trade?
For some advisors, no. They want the control, they have the appetite for the operational load, and they should build. For a lot of the advisors I work with, a few extra basis points buy back hundreds of hours a year. What you do with those hours is the decision.
Making the Right Decision for You
The framing I use with clients is that these are parallel tracks, not a fork in the road.
I have worked with several advisors recently who came in fully intending to launch their own RIA. We ran both paths side by side. What stopped a few of them was not cost. It was timing. They were growing fast, hiring, and acquiring, and building the infrastructure meant pausing all of that while they stood up a compliance function and sorted out who owned what.
So they joined a boutique RIA instead, which protected their independence, kept their momentum, and preserved the option to build their own RIA later within that same relationship. When they get there, the infrastructure and the support will already exist. They will be assembling something rather than starting from nothing.
That is a sequencing decision, not a compromise. Waiting to build is not the same as deciding never to.
Avoiding Buyers (Or Builders) Remorse
The advisors who regret this decision are rarely the ones who chose wrong on the economics. They are the ones who never separated the two questions in the first place. They wanted out from under a platform that had stopped fitting, and building their own firm was the only exit they could see.
You have more options than that, and you have them right now, while nothing is forcing your hand. Just because you can build your own RIA does not mean you should. It will not give you more time. It may give you a great deal of other things you want, and that is a legitimate reason to do it. Go in knowing which one you are buying.
If any of this sounds like where you are, it may be a conversation worth having. No agenda, just clarity. I am here when you are ready.