TL;DR: An RIA must register with the Securities and Exchange Commission (SEC) or state securities regulators. Registering as an RIA isn’t as intimidating as it seems. With planning and support, the process is achievable.
Main points:
- Small firms and solo advisors can register
- The process is faster with preparation
- Paperwork is manageable with guidance
- Series 65 isn’t always required if you hold certain qualifying professional designations.
- Expert help simplifies the transition
Becoming a Registered Investment Adviser (RIA) sounds extremely complex. Many advisors wonder how to register as an RIA and assume the process is only for large firms. In reality, it’s more straightforward than most think with the right guidance. Let’s clear up myths and explain what’s involved in registering an RIA.
Myth #1: Only Big Firms Can Become SEC Registered RIAs
Some think only large firms can become SEC registered RIA, but that’s not true.
Solo advisors and small firms can register if they meet the criteria. The requirements depend on variables tha dictate the registration entity, such as assets under management (AUM). You will either register with the SEC, or through state registration.
Myth #2: The Process Takes Forever
Many believe registering an RIA drags on for months. SEC review may last one or two months.
State processes vary, and can take several months, but preparation speeds things up. Understanding how to register as an RIA helps you avoid delays. Working with a partner who understands the process can also speed up the process.
Myth #3: The Paperwork Is Impossible to Handle
Filing forms like ADV look intimidating. They are detailed but manageable with proper guidance. Professional help simplifies drafting and reviewing this part. By partnering with a transitions partner like FocusPoint Solutions, you can register an RIA accurately and with confidence.
Myth #4: You Must Pass the Series 65 Exam (Always)
Some believe you always need the Series 65 license. Some states allow waivers based on credentials like CFP, CFA, or ChFC.
In SEC-registered firms, some IARs may not need a Series 65 if they hold the Series 7 or they hold a qualifying professional designation. Check state rules carefully. You still register, but your exam needs may vary.
Myth #5: You’re On Your Own During Transition
Many think you must go solo and figure it all out. That’s not the case. You can work with compliance consultants, custodians, and turnkey platforms (TAMPs). Some firms, like FocusPoint Solutions, offer support in all of these areas, and provide additional support for filings, tech, and operations. They can make it less stressful when you form your investment adviser firm.
Steps to Successfully Register RIA
In a nutshell, here are the steps to take to register an RIA:
- Determine SEC or state registration based on qualifying factors and requirements.
Ensure you have obtained the appropriate licenses (Series 65 or Equivalent. Identify the amount of fees you will be assessed as part of your registration and ensure your FINRA Gateway account is properly funded.File ADV Part 1A, Part 2A and Part 3 Relationship Summary (If SEC registered)Establish your compliance program tailored to your business model. Plan ahead and use support that makes the RIA register process faster and smoother.
Make It Simple, Start Today
These myths can scare you away from registering as an RIA. But the truth is, it’s doable with proper guidance. If you follow the steps and use support, you’ll finish faster and with less stress.
Your path to independence starts with one step—get experienced help and register your RIA with confidence. Want help? Call us today at 866-201-3034!