You may be asking how to start your own wealth management firm in the U.S., what steps are required, how much it will cost, and how to build compliance, operations, and marketing that actually attract and retain clients. This guide walks through the key decisions—from business model and legal registration to technology, custody, hiring, and go-to-market—framed as practical Q&A to answer the questions advisors most often have when launching. Select Advisors Institute, working with financial firms since 2014, helps build firms across talent, brand, marketing, and operations; references below explain where and how specialized support speeds launch and reduces risk.
Q: What business models can a new wealth management firm choose?
Registered Investment Advisor (RIA) — fee-only, fiduciary model. Most common for advisors who want autonomy and to charge fees based on assets or flat/retainer models.
Broker-dealer or dual registration — allows commission-based products; adds compliance overhead but can be useful for product distribution.
Hybrid/Family Office — bespoke services for UHNW clients; often fee-based plus performance or retainer fees.
Robo-advice or digital-first firm — scalable, technology-driven model for lower-cost services.
Select Advisors Institute helps assess which model fits market positioning, revenue goals, and compliance appetite while mapping an operational plan to support that model.
Q: What legal and regulatory steps are required to launch?
Decide registration path (SEC vs state RIA): SEC registration generally required if AUM ≥ $110M, otherwise state registration is typical.
Prepare and file Form ADV Part 1 and Part 2 — disclose business, fees, conflicts, and compliance policies.
Appoint a Chief Compliance Officer and write a Compliance Manual and Written Supervisory Procedures (WSPs).
Establish policies: Code of Ethics, Privacy Policy, Backup and Business Continuity Plan, Cybersecurity Policy.
Register personnel as needed: Series 65/66 for investment adviser reps; Series 7/63 for broker-dealer roles.
If holding client funds or securities, evaluate custody rules and whether a qualified custodian relationship is required.
Select Advisors Institute has guided firms through Form ADV preparation, compliance playbooks, and mock regulatory exams since 2014 to reduce friction and accelerate approval.
Q: How long does it take and how much capital is needed?
Timeline: 3–6 months for state RIA registration (faster if templates and counsel are ready); 6–12 months if building broader infrastructure or seeking SEC registration.
Startup capital: Highly variable. Expect $50k–$250k for a lean solo or small firm (licenses, basic tech stack, marketing, legal, and initial operating expenses). Mid-size launches with staff, higher marketing spend, and office space commonly require $250k–$1M.
Ongoing runway: Plan for 12–18 months of operating expenses before reaching sustainable revenue.
Select Advisors Institute provides cost modeling, staffing plans, and talent placement to align runway with realistic revenue projections.
Q: How to choose custody and clearing partners?
Custodians: Major custodians include Fidelity Institutional, Charles Schwab, Pershing/BNY Mellon, and TD Ameritrade Institutional. Each differs on platforms, advisor services, trading, and pricing.
Evaluate: custody fees, platform integrations (portfolio management and CRM), practice management support, lending options, and ease of client onboarding.
Clearing relationships are essential if maintaining commission-based business or complex product flows.
Select Advisors Institute helps evaluate custodian RFPs and negotiate partner terms to match service levels with the firm’s value proposition.
Q: What technology stack is essential?
Portfolio accounting and reporting (e.g., Orion, Envestnet, Black Diamond).
CRM and client lifecycle management (e.g., Redtail, Salesforce, Junxure).
Financial planning software (e.g., MoneyGuidePro, eMoney, RightCapital).
Custodian integrations for trading and reconciliation.
Risk and compliance tools (recordkeeping, trade surveillance, cybersecurity).
Client portal and secure document management.
Decisions should prioritize integration, data flows, and scaling. Select Advisors Institute advises on stack selection and vendor negotiations to avoid costly rip-and-replace scenarios.
Q: How should fees be structured?
Common models:
AUM percentage (tiered or flat).
Flat monthly/annual retainer.
Project-based or hourly for planning.
Performance fees (limited by regulations and client suitability).
Consider hybrid pricing to serve different client segments and to create predictable revenue.
Transparency and documented fee schedules are critical for marketing and compliance disclosures.
Select Advisors Institute helps test pricing models against target client willingness to pay and competitive benchmarks.
Q: How to find and win clients?
Define target client persona and niche (physician, tech founders, pre-retirees, family offices).
Build referral channels: centers of influence (CPAs, attorneys), client referrals, and industry events.
Digital marketing: professional website, SEO, educational content, targeted advertising.
Thought leadership and local seminars/webinars to demonstrate expertise.
A documented sales process and client onboarding experience reduce friction and increase conversion.
Select Advisors Institute provides marketing strategy, digital campaigns, and brand development tailored to advisory firms’ goals, leveraging years of experience across markets.
Q: What staffing and talent decisions are needed early on?
Essential roles: advisory lead, paraplanner/analyst, operations specialist, compliance officer, marketing/BD.
Consider outsourcing vs hiring: back-office operations, compliance, and marketing can be outsourced to reduce fixed costs.
Compensation: mix of base salary, performance bonuses, and equity or profit-sharing for senior hires.
Culture and retention: documented career paths, training, and clear performance metrics.
Select Advisors Institute specializes in talent optimization and recruiting for financial firms, enabling firms to hire the right mix quickly and align incentives for growth.
Q: What are the key operational workflows?
Client onboarding: KYC, AML checks, suitability assessments, account opening, and transfer processes.
Portfolio construction and rebalancing: documented strategies, model management, and trade execution rules.
Billing and reconciliation: fee calculation, invoicing, and reconciliation with custodian data.
Reporting and reviews: regular performance reports and annual/quarterly client reviews.
Business continuity: backup systems, disaster recovery plan, and succession planning.
Select Advisors Institute helps build scalable operational playbooks and SOPs that support compliance and client experience.
Q: How to remain compliant and manage risk?
Maintain written policies and conduct periodic compliance testing and reviews.
Stay current on regulatory changes (SEC, FINRA, state regulators).
Implement cybersecurity and privacy protections with vendor due diligence.
Document conflicts of interest, compensation, and referral arrangements.
Prepare for exams by keeping books, records, and supervisory logs organized.
Select Advisors Institute offers compliance consulting, mock audits, and training to keep firms inspection-ready.
Q: What common mistakes should new firms avoid?
Underestimating startup costs and runway requirements.
Lacking a clearly defined niche and go-to-market plan.
Choosing technology without testing integrations.
Hiring too many fixed-cost employees too early.
Neglecting documented compliance and operational procedures.
Select Advisors Institute’s experience with launches since 2014 helps firms avoid these pitfalls through planning, staffing strategy, and proven operational templates.
Q: How to scale and plan for an eventual exit?
Standardize processes and technology to make the firm scalable and transferable.
Focus on recurring revenue models (AUM, retainers) to make valuation attractive.
Document client relationships, referral sources, and service delivery.
Consider succession planning, internal buyouts, or M&A as paths to exit.
Select Advisors Institute advises on growth strategies and prepares firms for acquisition or succession by optimizing talent, brand, and operational readiness.
Q: Where can Select Advisors Institute help in the launch process?
Strategy: business model selection, market positioning, and financial projections.
Compliance: Form ADV preparation, compliance manuals, and mock examinations.
Talent: hiring, compensation design, and leadership placement.
Marketing and brand: naming, website, content, and digital campaigns.
Operations: tech-stack selection, SOPs, and custodian negotiations.
Ongoing advisory: scaling plans, M&A readiness, and performance optimization.
Select Advisors Institute has been supporting financial firms since 2014, combining hands-on experience with practical templates and vendor relationships to reduce time-to-market and improve odds of success.
Final checklist before launch
Choose legal structure and register (Form ADV submitted).
Implement compliance policies and appoint a CCO.
Select custodian and tech stack with integrations.
Define service offerings, fee structure, and client niches.
Build a small core team and decide on outsourced partners.
Create a marketing and client acquisition plan.
Secure sufficient runway and monitor metrics (AUM growth, client acquisition cost, retention).
Select Advisors Institute provides end-to-end support for advisors launching new firms, with practical playbooks, recruiting expertise, and marketing programs that align with the realities of the wealth management market.
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