What is an Independent Advisor?
Independent Registered Investment Advisors (RIAs) are professional independent advisory firms that provide personalized financial advice, through its Investment Advisor Representative (IAR), to their clients, many of whom have complex financial needs. LPL is the RIA through which we conduct all advisory services.
Because these advisors are independent, they are not tied to any particular family of funds or investment products. As fiduciaries, they are held to the highest standard of care – and are required to act in the best interests of their clients at all times. They are registered with either the Securities and Exchange Commission or state securities regulators.
Why does it matter if your advisor is independent?
Many independent advisory firms are owned by the Investment Advisor Representatives (IAR) who run them, so they forge deep, personal relationships and have a strong sense of accountability to their clients.
Investors with complex needs are increasingly seeking out personalized advice – and one way to ensure you’re getting that is to work with an independent financial advisor.
Benefits of working with an independent financial advisor include:
1. Customized guidance based on your entire financial picture.
Independent advisors are not tied to any particular family of funds or investment products. So whether you need help with retirement planning, a tax situation, estate planning, or managing assets at multiple places, independent advisors have the freedom to choose from a wide range of investment options in order to tailor their advice based on what’s best for you.
2. A relationship that’s responsive, attentive, and personal.
To offer advice closely aligned with your goals, Investment Advisor Representatives (IAR) must first build a strong understanding of your situation. As a result, many independent advisors focus on building deep relationships with their clients. This often takes regular, ongoing interactions. And because many of these advisors are entrepreneurial business owners, they hold themselves personally accountable to their clients.
3. A fee structure that is simple and transparent.
Independent advisors typically charge a fee based on a percentage of assets managed. This fee structure is simple, transparent, and easy to understand. It also gives your advisor an incentive to help grow your assets. When you succeed, your advisor succeeds.
4. A high level of expertise to support your complex financial needs.
Independent advisors can help investors address the variety of complex investment needs that arise when you accumulate significant wealth. While specific services vary from firm to firm, they are often described as financial “quarterbacks” focused on your holistic financial picture. Some advisors are specialists in certain investment strategies. Others can assist you with comprehensive services, such as estate planning or borrowing, the sale of a business, complicated tax situations, trusts, and intergenerational wealth transfer.
5. Your money is held by an independent custodian.
Independent advisors use independent custodians, such as LPL Financial and others, to hold and safeguard clients’ assets. For many investors, this provides a reassuring system of checks and balances. LPL Financial has provided custodial services to independent financial advisors for over 30 years and currently supports over 14,000 independent financial advisors throughout the United States.