On the surface, going independent can seem like a straightforward decision. Many advisors are drawn by the promise of a 90 percent payout or higher, motivated to leave the grid and reclaim full control of their practice. But too often, that headline number conceals a more complex picture. The reality is that independence comes with costs, and the advisors who succeed long term are those who evaluate the full equation, not just the payout.
Headline vs. Take-Home: The Payout Trap
While a 90 percent payout can appear substantially more attractive than a 50 or 60 percent wirehouse grid, that figure becomes less meaningful when weighed against the cost of replicating the platform left behind. Custodial relationships, compliance oversight, operational staffing, trading systems, marketing support, client reporting, and technology infrastructure all carry ongoing expenses-financial and operational.
Advisors often find themselves spending significant time on vendor selection, integration, and management. That time previously supported client relationships. In many cases, the effective payout after expenses, administrative demands, and scalability constraints mirrors or even falls below previous models.
Infrastructure: Build vs. Partner
One of the most misunderstood aspects of independence is the value of cohesive, institutional-grade infrastructure. Technology and compliance are not one-time implementations. They require ongoing maintenance, consistent updates, and robust governance.
Operating without scale often limits access to pricing advantages and dedicated service from custodians and technology providers. What begins as independence can quickly shift toward isolation-especially for advisors managing under $1 billion in assets without dedicated operations support.
Compliance and Oversight
Regulatory responsibility increases under the independent model. Advisors who register their own RIA must build and maintain a full compliance program, including policies and procedures, audit readiness, marketing review, Form ADV filings, and ongoing alignment with evolving SEC expectations.
The true cost of compliance is frequently underestimated. Both in hours and in exposure, it becomes a significant burden without dedicated support. Many advisors find that partnering with a platform offering centralized compliance oversight allows them to better serve clients while maintaining regulatory confidence.
The Scale Advantage
Scale creates leverage. Larger platforms often unlock preferred pricing, fully integrated systems, and shared staffing resources that solo firms cannot easily access. These efficiencies translate into measurable time and cost savings-enabling advisors to focus on growth, service, and long-term value creation.
A Smarter Path to Independence
True independence is not about taking on one hundred percent of the work to earn ninety percent of the revenue. It is about building a business that is aligned with your long-term vision-efficient, durable, and client-focused.
Before making the move, ask:
- What am I truly gaining?
- What infrastructure will I need to build, and how will that affect my time?
- What structure best supports my clients, my team, and my goals?
Independence does not mean going it alone. The most successful advisors are those who find a structure that preserves autonomy while minimizing unnecessary risk, cost, and distraction.
Because in the end, the goal is not just a higher payout. It is a better business.