We investigated the optimal number of independent parameters required to accurately represent spectral remote sensing reflectances (R rs) by performing principal component analysis on quality controlled in situ and synthetic R rs data. We found that retrieval algorithms should be able to retrieve no more than four free parameters from R rs spectra for most ocean waters. In addition, we evaluated the performance of five different bio-optical models with different numbers of free parameters for the direct inversion of in-water inherent optical properties (IOPs) from in situ and synthetic R rs data. The multi-parameter models showed similar performances regardless of the number of parameters. Considering the computational cost associated with larger parameter spaces, we recommend bio-optical models with three free parameters for the use of IOP or joint retrieval algorithms.