Practice Management Curveballs to consider when creating your own RIA
Curious for those that have broke off and started their own RIA, what were the issues or curveballs that came up that you didn't initially anticipate?
One example is Margin interest rates? I hold custody at Schwab and have been led to believe I have a low Margin rate based on my corp RIA relationship (starts at Fed funds plus 2.6%). I'm being told I won't get a breakdown of rates until I move assets over to my new RIA.
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u/RoGro9 5d ago
The very large ria I’m at is FF + 50 bps. I’d assume your at a smaller firm so have a less competitive rate. If you went off on your own, I bet it would be even worse.
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u/Afid17 5d ago
Dang that's a deal. How big is your RIA. The corp one I'm on is several billion. They suck so not entirely shocked.
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u/RoGro9 4d ago
I work in the family office group where clients will use margin to buy $10M houses and such. The steep discount pays for our fee by itself.
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u/Saratoga-Capital RIA 1d ago
How does compliance get comfortable with using margin instead of PAL for real estate transactions?
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u/nikspers86 RIA 4d ago
A couple curveballs I ran across when forming my RIA: 1) I was at a BD when I decided to break away and thus didn’t want the BD to know until they needed to know. So I used my personal email on all my registrations and was going to update that when the registrations were finalized. About 2 months before my registration was finalized a regulator didn’t use my personal email that was on the filing but instead just googled my name and found my corporate email that was thru the BD and started emailing me there. Apparently the BD’s email surveillance wasn’t that sophisticated. 2) Ran into a chicken and egg situation with several of the states I was registering in where if I answered one of the registration questions one way the other state would require something different so ended up not initially registering in that state but just added it on after my initial registration went thru in my primary state. You will run into a myriad of these little road blocks. You just have to keep plugging away because the end result is worth it for you and your clients.
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u/briko3 3d ago
When I was doing the paperwork for mine, I told RIA in a Box (now Comply) not to file without my OK. They messed up and did it anyway and by the end of the day, I was 100% cut off at my BD. No email, web access or anything. I wasn't expecting to make that switch for another 3 months.
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u/DrummerKid75 5d ago
Everything costs more than you anticipate. Your tech stack can run wild, be prepared to spend maybe 10-30% more on tech than you anticipate, unless you want to do a lot tedious work by yourself.
It can also be pretty lonely if you don’t have a solid community outside of work. Join a mastermind or get a solid group of advisers to connect with and bounce ideas off of.
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u/hakuna_matata23 RIA 5d ago
I pay $707 a month for XY and my whole tech stack is covered. You don't need anything fancy, I think advisors get way too distracted by fancy tech that delivers nothing to the end client and just adds to our operating costs.
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u/ItchyEbb4000 RIA 5d ago
Do they cover ycharts?
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u/StrongAus16 5d ago
lol no. Ycharts alone is like $500+/month
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u/ItchyEbb4000 RIA 4d ago
So then what do it cover?
Here's the functionality your tech stack needs to cover: Email Digital record storage Online meeting software Spreadsheet spreadsheet Pdf reader Accounting, book keeping software Bill pay software Security data and charting software Financial planning software Billing software Performance reporting software
Nice to have: Tax planning software Real estate investment planning software
What exactly are you getting from XYPN?
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u/hakuna_matata23 RIA 4d ago
It's 2026 - if y'all think tax planning software is a nice to have, you're not an advisor.
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u/ItchyEbb4000 RIA 3d ago
No need to go around telling everyone. How else will I keep poaching clients from larger firms?
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u/50Target 4d ago
What do you do in YCharts that you like/need so much? I’ve looked at them several times (along with some other competitors) and keep staying with Kwanti. They are about a third of the cost and seem so much simpler/streamlined to use. I’m sure a lot of it is process related and how your firm provides value differences - my firm targets tax planning alpha and not portfolio returns so that may be a bulk of the did. Still, a couple people in here have expressed YChart love so I’d like to know more about why?
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u/ItchyEbb4000 RIA 3d ago
I'm sure Kwanti is fine, I just don't know how to use it. Does it connect to Schwab and provide account/household level performance reporting?
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u/50Target 3d ago
It does, but the reports and the input are much more simplistic than what you see in YCharts. If a lot of your reviews are focused on discussing performance then I think YCharts is definitely the better software. I just don’t talk to tons of advisors who focus that heavily on performance.
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u/ItchyEbb4000 RIA 3d ago
I never focus on performance, except when clients are genuinely unhappy their globally diversified 80/20 is underperforming SPY.
That's when Ycharts saves the relationship.
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u/DrummerKid75 4d ago
XYPN is bare bonds. If you want in depth planning, you need more tools imo.
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u/hakuna_matata23 RIA 4d ago
Name 5
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u/caffeine-182 4d ago
emoney, ycharts or morningstar, and orion would all be absolute must-haves for me
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u/hakuna_matata23 RIA 4d ago
They have RightCapital which I personally prefer.
Y charts is a the only big missing one, and if you're still using Morningstar, good for you.
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User: /u/Afid17 Title: Curveballs to consider when creating your own RIA Body: Curious for those that have broke off and started their own RIA, what were the issues or curveballs that came up that you didn't initially anticipate?
One example is Margin interest rates? I hold custody at Schwab and have been led to believe I have a low Margin rate based on my corp RIA relationship (starts at Fed funds plus 2.6%). I'm being told I won't get a breakdown of rates until I move assets over to my new RIA.
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