How AI Simplified Launching My Independent RIA in Illinois
Introduction
Going fully independent has been the most difficult decision of my career. Weighing the benefits of a salaried position—steady income, employer benefits, and built-in support—against the flexibility, freedom to work with clients who aligned better with my life, and the upside opportunity of running my own firm was a constant internal debate. Ultimately, the desire to build something on my own terms, with a focus on family and long-term sustainability, led me to take the leap.
However, once I committed to launching my own fee-only, Registered Investment Advisory (RIA) firm, I quickly realized that the process was far from simple. Becoming a state-registered investment advisor requires navigating a series of regulatory hurdles, compliance requirements, and operational decisions that can be overwhelming for a single person. While plenty of resources exist, they vary in detail and clarity, making it difficult to create a streamlined, actionable roadmap.
In the evenings and on weekends, I dedicated time to researching the steps required to launch my firm. But as I dug deeper, it became clear that trying to handle this process entirely on my own would be inefficient and could lead to unnecessary delays. That’s when I turned to AI tools like ChatGPT to help make sense of the complexities. By running various searches, summarizing regulatory requirements, and breaking down compliance obligations into digestible steps, AI became an invaluable assistant in this process.
In this blog, I’ll share how I leveraged AI to simplify the RIA registration process in Illinois—from gathering information to making key decisions that helped me launch Rhodo Wealth Management efficiently and with confidence.
Navigating RIA Registration in Illinois
Registering as an investment adviser in Illinois is anything but straightforward. The process requires filing multiple forms, meeting various regulatory obligations, and paying several fees—without much direct guidance from the state. Unlike other industries where business registration is relatively clear-cut, there is no centralized resource that walks solo investment advisors through the step-by-step process. Instead, advisors must navigate a fragmented system, relying on third-party resources and legal interpretations to ensure compliance.
What’s Required for Registration?
To legally operate as an RIA in Illinois, several key steps and filings must be completed:
- Filing on the IARD System
- Form ADV Part 1A, 1B, and all required schedules and disclosures.
- Form U-4 for each investment adviser representative.
- A $400 filing fee for the firm and $150 per investment adviser representative, plus additional FINRA system fees.
- Submitting Documents to the Illinois Securities Department
- A balance sheet, prepared within 60 days of application.
- A copy of Schedule D of Form ADV, listing all Illinois branch offices.
- Corporate formation documents, such as articles of incorporation or partnership agreements.
- Proof of qualifications and exams for the designated principal(s).
- An affidavit of prior investment adviser activities in Illinois and other required compliance attestations.
- Additional Compliance Considerations
- Dual registration requirements if an advisor is also a registered salesperson.
- Ongoing obligations such as annual Form ADV updates, filing fees, and compliance audits.
- Examination requirements for investment adviser representatives.
For a solo advisor, piecing together these requirements without a structured guide is overwhelming. The lack of centralized resources means that missing a single form, misinterpreting a requirement, or filing incorrect information can lead to significant delays—delays that directly impact an advisor’s ability to start earning revenue.
The Challenge of Time and Complexity
Like many advisors making the transition to independence, I was balancing a full-time job, family responsibilities, and the pressure of launching my firm. Researching compliance requirements in the evenings and on weekends became a second job in itself. Every time I thought I had a handle on the process, I found new details that required further clarification. I quickly realized that without assistance, this process could take months longer than necessary, delaying my ability to work with clients and generate income.
How AI Simplified the Process
This is where AI tools like ChatGPT became invaluable. I used AI to:
- Summarize key requirements from state regulations, reducing hours of manual research.
- Extract important deadlines and document checklists to ensure nothing was missed.
- Compare multiple compliance sources to clarify vague or conflicting information.
- Generate initial drafts of compliance-related documents for further review.
Even with AI streamlining my research, the process remained highly complex. Before leaving my previous firm at the end of May 2024, I had already spent months refining my approach. Yet, despite my efforts, I wasn’t able to fully launch business operations until July 2024—a testament to how intricate and time-consuming RIA registration truly is.
Ultimately, after AI helped me break down the requirements, I determined that engaging a compliance consultant was the most efficient way to move forward. AI pointed me to a list of firms that specialized in RIA registration, and after evaluating my options, I hired a consultant to finalize my filings and ensure I met every requirement. Without the help of a compliance consultant, the decision to move forward would have been much more difficult given the demands of my personal life. Balancing a full-time job, family, and the complexities of registration on my own would have been overwhelming. However, knowing what this business could become for me and my family was the final straw in committing to the consultant. It was an investment not just in launching my firm, but in building something that aligned with my long-term goals and values.
Turning Ambition into Reality with AI
Outside of my wife and kids, launching my RIA has been the most rewarding thing I have done yet. I love the work I get to do with clients who align with both my personal values and their long-term financial goals. Most importantly, I get to help those clients using the tools and strategies I’ve acquired throughout my journey of becoming a CERTIFIED FINANCIAL PLANNER™. Having the independence to structure my business in a way that truly serves both my clients and my family has made every challenge along the way worth it.
But I wouldn’t have gotten here without leveraging every resource available to me—including AI.
AI is an extremely powerful tool that can help us tackle challenges that once seemed out of reach. Whether it's summarizing complex regulatory requirements, streamlining research, or organizing scattered thoughts into a clear plan, AI has already proven invaluable in making my transition to independence possible. And while the technology is still evolving, its potential is undeniable. (Let’s be real—this blog itself was largely formatted using AI, and I plan to keep using it regularly!)
If you’re stuck on something—whether it’s launching a business, tackling a big idea, or simply organizing the next step in a complex process—I encourage you to experiment with AI tools. You might be surprised at how much they can help you break through roadblocks and move forward with confidence.