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Building an RIA firm that scales

Starting an RIA can be incredibly exciting and challenging at the same time. When you’re in startup mode, you’re drinking from a fire hose. There are so many things to focus on, including registration, investment custodians, marketing, website, software, client service, fees, and more.

Michael Reynolds, the founder of Elevation Financial, a firm focused on socially-conscious financial planning, knows how challenging it can be to start your firm. When you’re getting started, it’s often less about getting everything perfect and more about getting your first few clients. But once you start working with a few clients and the dust settles a bit, it becomes clear that you’re going to need to figure out how to grow without working 60+ hours a week. This is why it’s important to learn how to scale your RIA early on.

Why scaling is important

So why focus on scaling? For one, it helps you serve more clients while maintaining a reasonable work schedule.

According to the Bureau of Labor Statistics, there are 218,050 financial advisors in the U.S. as of 2020. Compared to 329.5 million people in the U.S. in that year, that means that there are approximately 1,500 people for every financial advisor in the U.S.

That means there are a lot of people who need our help!

If you’re like most financial advisors, you have a strong desire to help others and you genuinely want to serve people who need guidance. Additionally, you may want to set up your RIA to be accessible to all, not just those with a minimum level of assets.

Setting up your RIA for scalability also helps you achieve greater profitability. When you can serve more people in less time, you are naturally able to earn more.

When you can scale, you also achieve greater freedom. You don’t have to work long hours all the time. You have systems and processes in place that handle much of the minutiae of the work. This helps you achieve greater flexibility in your schedule.

Perhaps most importantly, a scalable practice helps you deliver better service to your clients. When you’re constantly worrying about administrative details and reinventing the wheel with every engagement, you’re distracted and less effective. But when you have strong processes and automation, you can spend more time focusing on the needs of your clients and can be more present with them.

So let’s talk about some ways you can scale your RIA.

Client onboarding

The first place to focus on is client onboarding. After all, it’s the beginning of the engagement and where all work starts.

How are you delivering the agreement for signature? And what information can you collect along with it to get started? Sending your agreement via electronic signature is a must-have—it’s efficient and easy. Along with this, you can start collecting some basic information about your clients, like phone numbers and addresses.

Once this process starts, workflows will become your best friend. A workflow is a set of steps that guide you through a pre-set process. Most CRM tools have workflows that allow you to define the steps you need to follow when performing a task or delivering a service.

In the case of onboarding, you’ll want to think about all the steps you need to go through to set up a client. For example:

  • Create client folder in your file system and save signed agreement
  • Update client information in CRM
  • Add client to email list
  • Send new client onboarding email
  • Confirm that first meeting is scheduled
  • Send invoice to client
  • Invite client to planning software
  • Etc.

Without a workflow, it can quickly get messy because you won’t know where each client is in the process and details can get overlooked. It also causes stress because you have to keep everything in your head. A workflow removes the mental load and helps you focus on what’s important: your client.

Within workflows, it’s also helpful to make use of templates. These are pre-written blocks of text that you can use over and over. Without templates, you have to craft new emails every time. But with templates, you can auto-populate messages with pre-written content with the click of a button.

During your workflow, you will likely have points where you need to send an email to the client, such as sending instructions for scheduling the first meeting or entering data into your planning software. The message does not need to be different for every client. All you need to do is have the instructions defined, and then you can use the template to send it out from your library of templates to save time.

Any message that you find yourself writing more than once is a good candidate for a template.

For example, your template for scheduling a kickoff meeting could look something like this:


Thanks for sending back the agreement. I’m excited to be working with you! Let's get our first meeting scheduled. You can do that here:

Once that's scheduled I will follow up with more information and next steps.

If you have any questions, please let me know. Looking forward to talking soon!

Thank you,

Automation can also be a great time-saver during onboarding. One way to automate is to integrate your calendar tool with your video conference tool. Most online scheduling software will allow you to configure the tool to automatically create a video meeting when the event is scheduled. Additionally, these tools can be configured to send reminders to everyone at specific times before the meeting.

Scheduling tools can even be set up to email a checklist to the client to help them prep for the meeting. This relieves you of the task of sending out reminders and prep work messages.

Financial Planning and Investment Management

Scaling during onboarding probably seems straightforward. After all, it’s very procedural and administrative in nature. But what about financial planning and investment management? That must be personalized, right?

Yes. And it can also be scalable.

It’s true that financial planning is very personalized. Everyone you serve has unique needs and situations. These are not the things that scale. It’s everything else that can be integrated into a scalable process.

One way to add efficiency to your planning process is to use templates, just like you do in onboarding. Do you find yourself writing out similar recommendations for certain parts of your plans? This is a great area for a template. If you find that a lot of the people you serve are under-insured and you tend to write up life insurance recommendations using the similar language every time, create a template that contains the basics and then modify it to speak to the needs of each client individually.

For example, you might include a recommendation for life insurance using this template:

Life insurance is designed to provide financial security for your family if you were to pass. If anyone else is financially dependent on you, then it is recommended that you have life insurance.

Our recommendation is:

$X in 20-year term life insurance on XXX

$X in 20-year term life insurance on XXX

You can simply insert the pre-defined text from the template and then customize it as needed.

What about the planning process in general? Do you sometimes find yourself overwhelmed, wanting to make sure you address all the planning areas that are important? Create a planning workflow that guides you through a step-by-step analysis of everything you want to focus on for each client so you never miss anything.

Investment management can also scale. Once you reach a certain number of clients, it’s not feasible to manage each account individually. You’ll want to look for a custodian or investment management tools that allow you to create models and portfolios that can be managed globally across all accounts. This way, you can apply the right portfolio to each client, and then manage that portfolio in one place.

Ongoing client service

Once the initial planning phase for a client is complete, you will likely move into a phase of ongoing planning and service. This can also be scaled.

At the most basic level, you can set up workflows that prompt you to reach out to each client according to your cadence. This way, you have a solid schedule for keeping in touch. Using templates will allow you to perform this outreach without extra typing and re-typing.

As you send messages within this cadence, automation will increase efficiency. You may want to set up a unique calendar event type for each meeting and include a specific checklist for each one.

For example, your “Beginning of Year” review might send the client a checklist after it’s booked that contains items specific to that meeting, such as investment review items, asking them to complete a new questionnaire, or uploading certain documents. Your “End of Year” review might send out a different checklist, asking your clients to upload insurance documents or provide estate planning information.

Having pre-set agendas is another way to scale and reduce the time you spend on administrative tasks. This way, you both reduce workload and provide better service at the same time because you ensure that nothing falls through the cracks. A pre-set agenda for every meeting is a great way to lower mental load and facilitate more organized conversations.

Continuing a culture of scalability

So what’s next? Once you have great systems in place, you will likely find that you’re enjoying more flexibility, lower mental load, and providing better client service. And you are already creating a culture of scalability, even if you’re a solo advisor. This means that you understand the value of scaling and it’s becoming a core priority for your RIA.

As you continue to grow, you’ll start to naturally see opportunities to be even more effective using the methods discussed here. You’ll use your experiences with clients to update workflows so they fit your needs better. You’ll see ways you can evolve your templates and tools for better service. You’ll use real-world experience to continuously improve your processes.

As you do this, you will find that growth becomes even more exciting. And along with this, you’ll find that you’re able to help more people than you ever thought possible while enjoying the quality of life you deserve.

About the author:

Michael Reynolds is Principal of Elevation Financial, an independent fee-only RIA focused on socially conscious financial planning and ESG investing. Michael has founded, built, and sold multiple businesses and has a background in marketing, technology, and small business management. He lives in the Indianapolis area and loves Star Trek, great sushi, and spending time with his family.

Michael Reynolds is a customer of Altruist.

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