A Step-by-Step Timeline for Breaking Away from Your Firm and Registering Your RIA

If you've started seriously considering going independent, at some point the question shifts from should I do this to how do I do this?

This is where most advisors hit a wall.

Not because independence is out of reach, but because the path from "I'm thinking about leaving my firm" to "my RIA is registered and open for business" has many moving parts.

What follows is a realistic timeline for breaking away from your firm and registering your RIA. However, keep in mind that every practice is different, so your experience will vary.

Know what you're walking into

The single most important thing you can do before starting the process of breaking away to an independent RIA is read your current employment agreement.

Your contract likely includes provisions around non-solicitation, non-compete clauses, client ownership, and how you're permitted to handle client information. You must understand these before making any decisions (including telling anyone you're planning to leave).

This is the point at which many advisors benefit from a conversation with an attorney who specializes in financial services employment law. It doesn't have to be expensive or complicated. It just has to happen before you start.

Timeframe: Do this before anything else. It costs very little and protects everything.

Step 1: Decide on your business structure

Before you can register your RIA, you need a legal business entity to register. Most independent advisors form either an LLC or a corporation, depending on their state, their tax situation, and how they plan to structure the business.

This step involves:

• Choosing your business name (and checking that it's available)
• Filing your entity with your state's secretary of state
• Obtaining an EIN from the IRS
• Opening a dedicated business bank account

Your RIA registration will be filed under this entity, so it must exist first.

Timeframe: 1–2 weeks, assuming no delays in state filing.

Step 2: Choose your registration path — State or SEC

Not every RIA registers with the same regulator. Where you register depends primarily on how much client assets you manage.

State registration is required for advisors managing less than $100 million in assets under management (AUM). You'll register with the securities regulator in your state (and potentially in additional states where your clients are located).

SEC registration is required once you reach $100 million in AUM, though advisors anticipating rapid growth sometimes register with the SEC earlier under specific exemptions.

This decision shapes the registration process — the forms you file, the fees you pay, the regulator reviewing your application, and the ongoing compliance requirements you'll operate under. Getting this right from the start matters.

Timeframe: This isn't a weeks-long process — it's a decision that should be made early and correctly.

Step 3: Build your compliance foundation

This is the most substantive part of the registration process, and the part where most run into trouble.

Before you can submit your application, you need to have three core documents prepared:

Form ADV (Parts 1, 2A, and 2B)

Your ADV is your firm's primary disclosure document.

• Part 1 is a detailed questionnaire about your business.
• Part 2A is your firm brochure — a narrative document describing your services, fees, investment strategies, and conflicts of interest.
• Part 2B covers your individual background and qualifications.

Every section needs to be accurate, complete, and consistent. Regulators flag inconsistencies. What you file now creates the baseline your firm will be held to going forward.

Form CRS (Client Relationship Summary)

This shorter document summarizes your services, fees, conflicts, and how to get more information. It has specific formatting requirements and has to be delivered to clients at the start of your relationship. Simple in concept, however, easy to get wrong in execution.

Compliance manual

Your compliance manual documents your firm's internal policies and procedures. How you handle trading, supervise staff, protect client data, and review communications. Regulators expect this document to exist before your firm opens, and they may ask to review it during an exam.

These documents take time to prepare correctly. A compliance consultant who knows the process can compress this significantly, and more importantly, will make sure your filing holds up to regulator scrutiny.

Timeframe: 3–4 weeks with professional guidance. Longer without it.

Step 4: Submit your registration application

Once your documents are prepared, your registration is submitted through IARD — the Investment Adviser Registration Depository, the central system used by both the SEC and state regulators.

At this point you'll pay your filing fees and your application enters the review queue.

State reviews vary widely — some states are known for quick turnarounds, others take longer.

The SEC typically has 45 days to declare your registration effective or request more information.

Timeframe: Submission is a single day. Review period is typically 2–8 weeks depending on your state and application quality.

Step 5: Respond to any deficiency letters (if applicable)

A deficiency letter is a formal notice from your regulator identifying issues with your application that need to be addressed before your registration can be approved.

Common deficiency triggers include:

• Incomplete or inconsistent ADV disclosures
• Missing or improperly formatted Form CRS
• Compliance manual gaps
• Unclear fee descriptions or conflict disclosures

Not every application receives a deficiency letter. Advisors who work with experienced consultants tend to get through this stage without one, as someone with experience will generally catch the issues beforehand.

If you do receive one, respond promptly and completely. Dragging out this stage is the most common reason registrations take longer than they should.

Timeframe: Variable (the goal is to not be here at all)

Step 6: Receive approval and prepare to launch

When your registration is declared effective, you're officially a registered investment adviser.

But there are a few things to have ready before you open client accounts:

• Custodian account setup (Schwab, Fidelity, Vanguard, etc.)
• Client agreements and onboarding documents
• Form CRS delivery process (you're required to deliver it to new clients at the start of the relationship)
• Investment advisory agreement
• Any technology you'll use to manage portfolios and communicate with clients

If you've laid the groundwork throughout the process most of these will be in motion by the time your approval arrives.

Timeframe: If prepared, you can be operational within days of approval.

What the full timeline looks like

For a well-prepared advisor working with professional guidance, the process from entity formation to registration approval typically takes 8 to 12 weeks.

That timeline can stretch if your application has deficiencies, if your state regulator has a longer review queue, or if key documents weren't prepared correctly the first time.

It can compress if you have expert help and move quickly through the preparation phase.

Either way, most advisors are surprised by how achievable this is once they see it laid out clearly.

Navigating the purgatory of being tied to your old firm and going independent

Honestly, the most complicated part of becoming an independent RIA is not the paperwork…

We’ve found that the part of becoming an independent RIA tends to be the period between deciding to leave your current firm, and actually leaving — when you're still at your firm, still meeting with clients, still going through the motions — while quietly building something in the background.

That takes patience. It takes discretion. And it takes a plan.

The advisors who do this well are the ones who start the process with a clear picture of what's ahead, work with people who have done it before, and don't try to navigate it alone.

Ready to map out your breakaway timeline?

Every advisor's situation is a little different; your AUM, your state, your client base, and your transition plan all affect how this process unfolds for you specifically.

At My RIA Registration, we guide advisors through every step of this process — from the very first conversation to the day your registration is approved.

We prepare your ADV, your Form CRS, and your compliance manual.

We file everything for you.

We are prepared to stay with you as a compliance partner after the launch.

If you're starting to consider the decision to break away from your current RIA firm, to gain more independence, let's talk about what the process and timeline will look like for you.

→ Book a free consultation at myriaregistration.com

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