What is an RIA?
A Registered Investment Advisor (RIA) is a firm or individual that provides investment advice to clients and is registered with the relevant regulatory body—either the Securities and Exchange Commission (SEC) or state securities authorities. RIAs have a fiduciary duty to act in the best interest of their clients, distinguishing them from other types of financial advisors who may follow a suitability standard.
- RIAs typically offer personalized investment management and financial planning services.
- They are compensated through fees rather than commissions, minimizing conflicts of interest.
- Registration depends on assets under management (AUM); those managing over $100 million generally register with the SEC.
- RIAs are subject to regular compliance reviews and must adhere to strict disclosure and conduct rules.
What does this mean for family offices?
Engaging an RIA can provide family offices with a regulated, transparent advisory relationship. This is particularly useful for offices seeking customized investment oversight without building in-house capabilities. RIAs can also support governance structures by acting as an external, fiduciary-aligned advisor.
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