Registered investment advisory firms topped previous records in many key business metrics in 2024, with assets under management crossing $144.6 trillion. The number of firms registered with the Securities and Exchange Commission and their AUM, clients and employees reached new heights from prior records, as shown in the below charts based on the latest yearly “Investment Adviser Industry Snapshot” by the Investment Adviser Association, a trade group, and COMPLY, a compliance firm. The overall figures, though, obscure some challenges posed by the need for organic growth rather than through M&A and asset appreciation. And any financial advisor thinking about joining an RIA or launching a new one must consider factors ranging from the macroeconomic forces affecting the entire industry to the many potential issues that could play out among their clients and employee teams, according to Julie Genjac, the vice president of applied insights for Hartford Funds, where she coaches advisory teams in practice management. “Interestingly, many new entrants into the RIA space are not immediately looking to scale or merge,” she said in an email. “Instead, they’re eager to test their independence, see how their team functions autonomously and gain firsthand experience running their own firm. While some may eventually choose to join a larger RIA for added infrastructure and support, the initial appeal of independence continues to drive a steady stream of new firms into the market. This trend underscores the enduring appeal of autonomy and customization in wealth management and suggests that, despite consolidation headlines, the entrepreneurial spirit within the industry remains strong.” Other trends fueling the RIA movement stem from that flexibility in areas like marketing, client experience and the business model of a firm, and the way that advisors are “increasingly attracted to the opportunity to retain a greater share of revenue while also having the freedom to design compensation models that suit their teams,” Genjac added. As with any study tracking RIAs, the IAA/COMPLY industry snapshot chooses specific criteria that will bring some data noise to any conclusions about the wealth management business. The report covers every type of SEC-registered firm, so the numbers include both wealth and asset management firms and those catering to retail clients and institutions.