The Ultimate Guide: Independent Financial Advisors

An independent financial advisor is a professional who provides unbiased financial advice to clients and doesn't represent any specific investment firm. AdvizorPro has put together an in-depth guide with expert analysis to help you better understand this fast-growing area of the wealth advisor space.

One of the fastest growing areas of the wealth advisor space is independent financial advisors. There are approximately 76,000 independent financial advisors and 25,000 independent financial advisor registered investment advisor (RIA) firms in the United States as of July 2023. 

Some of the larger independent financial advisor firms include Raymond James, Cambridge Investment and Creative Planning. The various types of advisors that exist such as wirehouse, bank or independent financial advisors can be confusing to differentiate and understand. 

This blog is intended to be a guide to understanding independent financial advisors – their incentives, pros, and cons. 

AdvizorPro is a trusted data provider on the wealth management industry with access to historical and current data on RIAs, broker-dealers, and individual financial advisors across the US. We source data from the SEC, FINRA, millions of wealth advisor webpages and other proprietary sources. 

We offer a RIA database software that includes updated and accurate data on the entire independent financial advisor universe. 

Let’s explore what defines an independent financial advisor and the key differences between independent and non-independent advisors. 

We’ll then cover the advantages that come with independence in your financial advisory practice, as well as the potential considerations you should be aware of. 

Finally, we’ll provide a step-by-step guide on how to embark on this exciting journey and become an independent financial advisor.

What is an Independent Financial Advisor?

An independent financial advisor is a licensed professional who offers personalized and unbiased financial advice to their clients. Operating autonomously, independent advisors have no affiliations with financial institutions that may influence their recommendations. They prioritize client interests above all else, providing objective guidance tailored to individual needs and financial goals. 

The independent financial advisor channel is a growing one in the wealth space as advisors and investors both get more sophisticated.

Clients of independent financial advisors benefit from unbiased comprehensive advice and the independent financial advisors themselves benefit from a better share of their revenue, increased flexibility and an ability to customize their practice to their clients needs.

What is the Difference Between an Independent Financial Advisor and a Non-Independent Financial Advisor?

The distinction between independent and non-independent financial advisors lies in their affiliations and obligations. Non-independent advisors work for specific financial institutions and may have restricted advice when it comes to recommending products and services offered by their employer. 

In contrast, independent advisors maintain complete autonomy, allowing them to offer a diverse range of financial solutions from various providers, putting their clients’ best interests at the forefront.

Advantages of Being an Independent Financial Advisor

Unbiased and Objective Advice

As an independent financial advisor, you can provide unbiased advice that aligns solely with your clients’ financial needs and objectives, building trust and loyalty.

Customized Solutions

Embracing independence grants you the flexibility to tailor an investment strategy that meets the unique needs and goals of each individual client, ensuring a more personalized approach. The reality is each prospective client is so different. Boxing them into a few personas as non-independent financial advisors are often forced to do means that clients do not receive optimal advice or solutions. Customization means better outcomes for clients. 

Freedom and Autonomy

As an independent financial advisor, you have the freedom to run your practice as you see fit, making strategic decisions and selecting the most suitable financial products and services for your clients.

Enhanced Client Relationships

Independent advisors often build stronger and more meaningful relationships with their clients, as the focus is solely on delivering exceptional service and financial decision-making that fosters long-term success.

Diverse Income Potential

Embracing independence can open doors to various revenue streams, such as fee-based services, commissions, or performance-based fees, allowing for a more diversified income structure.

Continued Professional Growth

Being independent allows you to pursue specialized certifications and designations that further enhance your expertise and credibility in the industry. Many independent financial advisors carve out a niche for themselves by building expertise in a specific area such as estate planning.

Disadvantages of Being an Independent Financial Advisor

Increased Responsibility

As an independent financial advisor, you assume full responsibility for compliance, operations, marketing, and client acquisition, requiring meticulous attention to detail.

Initial Costs and Setup

Starting an independent practice may involve higher initial costs, including office space, technology, and licensing fees.

Limited Brand Recognition

Independent advisors may face challenges in competing with larger financial institutions that have established brand recognition and resources.

Business Development

Building and maintaining a client base as an independent financial advisor requires proactive business development efforts and networking.

Regulatory Compliance

As an independent advisor, you must stay abreast of ever-changing regulations and ensure full compliance with industry standards.

What Are Some of the Tools Available to Independent Financial advisors?

The tech industry surrounding the independent financial advisor and RIA space is one that has boomed over the past few years and continues to do so. The amount of innovation driving efficiency and quality of work for independent advisors is astonishing and so good for the advisors themselves as well as their clients. 

Independent financial advisors have their choice of dozens of softwares that best fit their needs for everything from their CRM system to investment platform, to niche needs like estate planning tools. Below are a few of the options that exist for independent financial advisors: 


Comprehensive financial planning software that helps advisors create personalized financial plans, analyze client scenarios, and track progress towards financial goals.


A user-friendly CRM platform designed specifically for financial advisors to manage client relationships, track interactions, and stay organized.

Orion Advisor Tech

An investment portfolio management software that streamlines portfolio rebalancing, performance reporting, and client billing for advisors.


A risk assessment tool that quantifies clients’ risk tolerance and matches them with suitable investment strategies.

Redtail CRM

A robust CRM platform tailored for financial advisors, enabling efficient client data management and communication.

Salesforce Financial Services Cloud

A CRM platform with features specifically designed for financial advisors, allowing them to deliver personalized experiences to clients.

Tamarac by Envestnet

A comprehensive technology platform that offers portfolio management, performance reporting, and client communication tools for advisors.


All-in-one wealth management software that includes portfolio management, reporting, financial planning, and client portal features.


Financial planning software that offers interactive client planning tools and helps advisors create comprehensive financial plans.


A platform that combines risk assessment, portfolio analytics, and proposal generation for advisors.


Document management software that helps advisors securely store and manage client documents, streamlining compliance efforts.

Schwab Advisor Services

Custodial platform for independent advisors that provides access to investment products, research, and client account management tools.

These are just a few examples of the many software tools available for independent financial advisors. The selection of tools will depend on the specific needs and goals of the advisor’s practice and the preferences of their clients.

How to Become an Independent Financial Advisor

Acquire the Necessary Licenses

Obtain the appropriate licenses and registrations required to practice as an independent financial advisor in your jurisdiction.

Gain Experience

Build experience in the financial services industry to enhance your expertise and credibility.

Define Your Niche

Identify your target market and niche specialization to differentiate yourself in the competitive market.

Create a Business Plan

Develop a comprehensive business plan outlining your services, target clients, marketing strategies, and financial projections.

Secure Compliance

Comply with all regulatory requirements and adhere to industry best practices to maintain credibility and trust with clients.

Build Your Brand

Establish your brand identity and leverage digital marketing strategies to increase visibility and attract potential clients.

Becoming an independent financial advisor is a rewarding path that offers significant opportunities for professional growth and client-centric practices. 

The advantages of providing unbiased guidance, offering personalized solutions, and enjoying the freedom to make strategic decisions are some of the reasons the area continues to see significant growth in the wealth advisory space. 

Though having its own challenges, some of which we highlighted, the rewards of building strong client relationships and creating a thriving practice make the journey worthwhile. 

At AdvizorPro, we work with thousands of independent financial advisors and other wealth managers to help them in their recruiting or M&A as well as numerous fintech platforms looking to serve more independent financial advisors. Contact us today to get started.