How To Transfer Investment Accounts


Myth : You Cant Transfer Mutual Funds

Transferring Money and Investments

It depends on your new brokerage. You can transfer mutual funds as long as your new brokerage has an agreement in place to accept the funds or fund families you have money in. But if your new brokerage doesnt offer the same mutual funds, it doesnt have to be a deal-breaker. There are other ways to get your money transferred.

For example, you could liquidate your mutual funds at your existing brokerage and purchase similarly structured ETFs at your new brokerage. Many new M1 clients choose to do this, since we dont offer mutual funds.

Some clients also choose to transfer mutual funds, OTC securities, options, and bonds. If youre interested in transferring, heres how well handle it:

  • Mutual funds: Liquidate them and give you the cash, which you can reinvest as you see fit.
  • OTC securities: We offer some OTC securities through American Depository Receipts . If we do not offer your specific OTC security, you can liquidate and reinvest.
  • Options: Let them expire. You cant trade the option while its on our platform. If the option is ITM, we will automatically exercise it. You can also conduct a partial transfer excluding your options.
  • Bonds: Let them mature. You cant trade these on M1 right now.

If you have a question about your specific situation, get in touch with us at .

What Must A Customer Do To Start The Account Transfer Process

Individuals wanting to transfer their securities account from one broker-dealer to another initiate the process by completing a Transfer Initiation Form and sending it to the firm to which they want to transfer their account. The firm a customer is transferring the account to can provide the form to facilitate the transfer. The new firm is called the “receiving firm.” Once the receiving firm receives the TIF, it begins the process by communicating with the current or “delivering firm,” via ACATS.

To Get A Special Offer

Brokerage firms regularly run special promotions to bring in new business. A broker might run a promotion that offers referral bonuses when you recommend friends or family. Or you might get a sign-up bonus when you open an account and fund it with a certain amount of money.

While these special offers can be great, its important to explore the other features of a brokerage firm. Dont sign up just because it has a promotional offer going on, but doesnt necessarily offer everything else you need. Only transfer your funds if you would switch to that broker anyways, and the promotion simply creates extra incentive.

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Transfer On Death Vs Beneficiary Designation

A brokerage account with a beneficiary designation is an account in which the brokerage firm has been told whom to transfer the assets of that account to when the person dies. This is usually done by filling out beneficiary forms when the brokerage account is initially created.

When someone sets up a transfer-on-death account, the person listed on the transfer-on-death stock form immediately receives the assets in the account at the time of your death. You may wonder why someone would choose to transfer stock ownership after death with a transfer on death account rather than simply naming a beneficiary in the will. A transfer on death account is different from making brokerage account beneficiary designations in the will for two important reasons:

  • A transfer on death account is immediately transferred to the listed person when the owner dies. This means the account avoids going through probate entirely.
  • Since the account is transferred immediately on death and avoids the probate process, the account is not subject to any debts the deceased person may have owed.
  • These two reasons are two huge benefits to the beneficiary and good reasons for opening up a transfer on death account rather than just naming a beneficiary of your investment accounts in the will. By setting up a TOD account, theyre helping the beneficiary to avoid the hassle of inheriting a brokerage account that needs to go through probate.

    Transferring Your Assets Into Robinhood

    How to make transfers between investment accounts
    • Eligible assets from your outside brokerage can be transferred into Robinhood through the Automated Customer Account Transfer Service .
    • We currently support full and partial account transfers of eligible securities.
    • Well reimburse the transfer fee your other brokerage may charge, up to $75.
    • Before starting an account transfer, review the What can I transfer into Robinhood? section of this article.

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    Complete A Transfer Initiation Form

    The next step in the process of closing your account is to complete a transfer initiation form, generally just referred to as a TIF. Your TIF will come from your new firm and your new broker can guide you in the process.

    The specific information required by your TIF will depend upon the receiving firms standards, but generally includes:

    • Social Security Number, and
    • Details of all the assets you need to transfer

    Double-check all of your information, as most brokerage firms will immediately reject any transfer request that has incorrect personal or account information. Your new brokerage firm will then use your TIF to communicate with your old firm and begin the transfer.

    Most brokerage firms have digitalized the TIF process. Check out the video below for an example:

    When To Consider Switching Brokers

    Switching brokers isnt a minor decision, especially if you have a large portfolio. But there are many reasons why you may want to switch. Your existing broker may have any number of issues:

    A new broker may offer more favorable options for any of the above, which would be an added benefit of switching. Thus, before pulling the trigger, you should do your own research and consult a tax professional where appropriate.

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    Use The Correct Forms

    The new brokerage typically will ask the investor to fill out a transfer initiation form, also known as a transfer instruction form, to initiate the move from one firm to another. Account information that may be requested includes Social Security number, details about the old brokerage account, as well as the types of assets and amount to be transferred.

    The new brokerage also may ask for additional documentation, such as brokerage statements from the old firm, though this requirement can vary between brokerage firms.

    These forms include instructions to the brokerage on the type of transfer and description of the assets. Incorrect information or errors could result in fees, delays, or the brokerage selling assets before transfer, for example, which could lead to tax consequences.

    Once the transfer initiation form is submitted for an in-kind transfer, the new brokerage will contact the old one to start the transfer. If doing a manual transfer, the first step may be to liquidate any assets, and in some cases, do the transfer yourself.

    How Are Accounts Transferred Between Broker

    How to transfer funds and securities between accounts

    Most customer accounts are transferred between broker-dealers through an automated process. The National Securities Clearing Corporation operates the Automated Customer Account Transfer Service to facilitate the transfer of a customer account from one broker-dealer to another. Transfers involving the most common assets, for example, cash, stocks and bonds of domestic companies, and listed options, are readily transferable through ACATS.

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    Myth : Brokerage Account Transfers Have Hefty Fees

    The fees you pay to your current brokerage to close or transfer your account are often a misconceptionhere are three reasons why:

    1. Over time, a commission-free platform can potentially help compensate for transfer fees.

    The fees to transfer brokerage accounts typically range from $50 to $200. Lets say your current brokerage charges fees for account management or purchasing new securities. If you transfer to a new brokerage firm that charges lower fees, you could potentially make up the difference. Of course, this depends on many different factors including how much money you have in your account and how often you update your portfolio.

    Heres how a 1% fee impacts a $25,000 portfolio over time.

    Discover more information about M1 fees

    2. The fee could be lower than taxes youd pay.

    You could potentially avoid the fee by liquidating your account and transferring the cash to a new brokerage.

    In most cases, this would be considered a taxable event, meaning youd have to pay taxes on your gains .

    If the taxes are greater than the fee, the fee might be a good deal. But if youre transferring an IRA, you dont have to pay capital gains taxes on the pre-transfer sale of your securities.

    3. In-kind transfers can give you peace of mind.

    Even if the fee is larger than the amount youd pay in taxes, you may still want to pay it simply for the convenience of having someone else handle the process for you.

    Tax Implications Of Switching Brokers

    One of the biggest reasons to let your new broker handle the account move via an in-kind transfer are the tax implications. If you opt for a cash transfer and sell all of your securities, you could trigger capital gains. And if you sell securities youve owned for one year or less, you may run into short-term capital gains, which have an even higher rate than the tax rate for securities owned more than a year.

    In addition to the risk of selling securities for cash, there are tax implications if you are transferring retirement accounts. These accounts have special rules when transferring, including a custodian requirement. And if you are under the allowed retirement age, the transfer could be treated as a distribution if not handled properly,resulting in taxes and penalties. Plus, if the transfer isnt completed within 60 days, that, too, could trigger a distribution.

    As you can see, there are quite a few tax considerations when moving your accounts. Your new broker will be familiar with the process and know how to handle it the right way. Allowing the brokerage to take care of the transfer is usually the best way to avoid costly errors.

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    Gather Documents From Your Old Broker

    Before initiating the transfer process, gather all available documents from your old broker. You should download recent statements of your account, including your account number and the current value of your investments.

    Having these statements is important for your own personal documentation, and may be necessary for tax purposes. It will also come in handy if anything goes wrong with your transfer, as youll have documentation showing what investments you were attempting to transfer.

    Cash Deposits With Webbroker

    How to do Bank Transfers in Aplos

    Login to WebBroker to transfer money from your TD Canada Trust bank account to a TD Direct Investing account.

    • Have Canadian currency in your bank account and want to trade in U.S. dollars ? Transfer or exchange your money in a few simple steps. You’ll get a real-time exchange rate before you confirm your request.
    • Some registered account types, such as RRSPs or RIFs, have restrictions on contributing or withdrawing money. Please ensure you understand the rules. Visit the CRA site for restrictions.

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    Transferring Retirement Or Other Tax

    Transferring a tax-advantaged account, like an individual retirement account , requires a bit more care than a typical transfer. IRS regulations give you a limited amount of time to complete the transfer. If you fail to get the money back into an IRA at your new broker in time, it could be treated as a distribution and be subject to taxes and penalties.

    Transferring Your Brokerage Account: Tips On Avoiding Delays

    Many investors transfer their accounts from one brokerage firm to another without a hitch. If your transfer goes smoothly, count on the whole process taking two to three weeks. But this time frame may vary depending upon such factors as the assets involved, the types of accounts, and the institutions between which the transfer occurs.

    Transfers may be delayed if:

    • the wrong transfer form is used
    • the transfer form has been incorrectly completed
    • the transfer involves a request to liquidate some or all of your assets
    • the transfer includes a margin account
    • the transfer is from one type of account into a different type of account
    • a change in the account owner is made or
    • the transfer involves a retirement account.

    This document walks you through the transfer process and provides tips on how to avoid problems.

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    Transferring Assets Between Accounts At The Same Broker

    If you are moving money between two different accounts at the same brokerage firm, its often much easier than moving investments between different brokers. This is because your broker wont have to work with another company to facilitate the transfer.

    If youre opening an investment account for a child or young relative, its probably a good idea to use the same brokerage for this that you use yourself.

    You Want To Snag Some Tax Breaks

    How to transfer stocks from one Etrade account to another Etrade account(4min)

    The upside of keeping your money in a savings account is getting to earn interest on it, while still having easy access to that cash. But you don’t get a tax break on the money that goes into your savings account. Quite the contrary — the interest you earn in your savings account is subject to taxes.

    If you’re looking to reduce your tax burden, you may want to move some of your cash into an IRA. Traditional IRA contributions are exempt from taxes, so if you put $3,000 into an IRA this year, the IRS won’t tax you on that $3,000.

    Now one thing you should know is that IRAs are somewhat restrictive in that you can’t access your money before age 59 1/2. Doing so commonly results in a 10% early withdrawal penalty . But if you have money you don’t need for emergencies and you’re willing to earmark it for retirement, then it pays to make that transfer.

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    How To Transfer Stock Between Brokers

    The most common way to transfer stock between brokers is the direct transfer method. Most brokers use the Automated Customer Account Transfer Service to move investments this way.

    Here’s how an ACATS transfer works:

  • Start the process by filling out a transfer initiation form with your new broker. This form should be available online, but you can call your new broker if you need help.
  • Your new broker communicates with your old broker to set up the transfer.
  • Your old broker must validate the transfer information, reject it, or amend it within three business days.
  • Assuming your old broker validates the transfer and there are no issues, the transfer should be completed within six business days.
  • Your old brokerage firm may charge a transfer fee. Fortunately, the best online brokers frequently offer deals in which they pay any transfer fees the old broker charges. Before you start your transfer, check if there will be a fee and if your new brokerage firm will cover it.

    Note that some brokers sell proprietary investments, such as their own mutual fund, that they won’t allow you to transfer to a new broker. Your new broker will notify you of any assets that can’t be transferred.

    Despite the time it takes to transfer stock between brokers, it’s by far the most cost-effective option. To explain why, we need to go over the alternative method that can be very expensive.

    How To Transfer Brokerage Accounts

    To transfer a brokerage account, you’ll need a brokerage account with your new broker . Once you’ve set that up, here’s what to do:

  • Log in to your account with the new broker.
  • Go to the transfer page. Where you find this depends on the layout of the broker’s website. If you have any trouble finding it, contact the broker for assistance.
  • Choose the option to transfer a brokerage account. This should take you to the broker’s transfer form.
  • Fill out the form with the required information.
  • Enter your account information with your old broker on the transfer form.

    After you submit the form, the transfer process is mostly a hands-off affair. The action happens behind the scenes, as your new broker communicates with your old broker to get your investments moved over.

    It usually takes six business days to transfer a brokerage account. Your old broker validates the information within three business days and transfers the assets within another three business days. It can take longer, though, particularly if there are any discrepancies during the validation process.

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    Can I Transfer Stock From One Brokerage To Another

    What are the documents required to transfer the SBI savings account ...

    Yes, it is possible to transfer stocks and other investments from one brokerage account to another.

    There are many reasons that you might want to do this. For example, you might have started a new job that uses a different company for its retirement accounts. Keeping all your investments with the same broker can make it easier to manage your money. Another reason to change would be to improve upon your current brokers fee structure.

    Whatever your reason for changing from one broker to another, youll want to start the process by contacting the brokerage you wish to move your stocks to. Your new broker, also called the receiving firm, helps facilitate the transfer.

    Most transfers are handled using an automated system. Still, the full process can take about a week, so you should be ready to wait for it to complete. Keep in mind that you wont be able to buy or sell securities during the process.

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