You want to transition your practice to the RIA model.

You are currently affiliated with a multi-channel firm. One of those options is their “RIA channel.”

Should you make the “internal” transition of your practice to it?

This question is more complicated than it seems:

- Are you sure you know what your firm is referring to when they say “RIA channel?” Firms use the same vernacular to refer to different models.

- Is an internal move to the channel even an option? (Spoiler: In some instances, it’s not!)

- Are you aware of how the internal option compares to external options available to you as well?

These are just some of the variables that should be part of your due diligence.

In this episode of the Transition To RIA question & answer series I clarify if and when it makes sense to consider an internal option.

I'm Brad Wales with Transition To RIA (TransitionToRIA.com). This is episode #104 of my question and answer series where I answer RIA related questions I get from advisors just like you.

What I do: At Transition To RIA I help financial advisors understand everything there is to know about WHY and HOW to transition their practice to the Registered Investment Advisor (RIA) model.

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Should I transition to the RIA channel at my multi-channel firm? That is today's question on the Transition To RIA question & answer series, it is episode #104.

Hi, I'm Brad Wales with Transition To RIA, where I help you understand everything there is to know about why and how to transition your practice to the RIA model.

If you're not already there, head to TransitionToRIA.com, where you’ll find all the resources I make available from this entire series in video format, podcast format, I have articles, I have whitepapers. All kinds of things to help you better understand the RIA model.

Again, TransitionToRIA.com.

On today's episode, we're going to talk about an advisor scenario I come across often. It's sometimes thought of, “should I make an ‘internal move’ within my firm to this RIA channel they have?”

Depending on what kind of firm you're at, maybe you're in a W-2 model or 1099 model, but let’s assume you're at a so-called multi-channel firm. Examples of those are LPL, Raymond James, Wells Fargo. They have multiple affiliation channels and one of those is the so-called RIA channel, or that's how it's sometimes expressed.

Advisors in other channels, W-2 or independent contractor, are saying, "Maybe I want to transition my practice to that. Is that a good move for me?" That's something I help advisors with frequently. That's what we're going to talk about on this episode.

The first thing you want to think through whenever I hear this question asked is exactly what are we referring to when we say the RIA channel of your multi-channel firm?

I hear it used referring to different things. I want to give a couple examples of what some of those flavors are and then clarify what I'm going to be talking about on this episode and then we're going to dive into some details of that.

In some instances, firms will refer to their RIA channel as their corporate RIA offering - I've done an episode on what is a corporate RIA. If you're at a traditional "broker-dealer" and you're already offering fee-based accounts to your clients, you are already under some flavor of a corporate RIA now.

Be careful though, as sometimes firms want to position that as, "That's our RIA channel." As the reality is you are under an RIA in that. They could call it the RIA channel, but it's typically not what advisors are thinking when they're talking about, "I want to move to the RIA channel." But it might be what their firm is referring to. So keep that in mind.

Another variation I sometimes hear is where a firm is referring to their corporate RIA, but where the firm says, “You can be under our corporate RIA and not have any tie to our adjacent broker-dealer."

In that scenario, you are dropping your 7, you're dropping the broker-dealer, you're dropping FINRA, you are going to be, as they say, “IAR-only” under the corporate RIA. Con't....

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