How to Transfer a Brokerage Account

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In an ideal world, everyone would choose the perfect investing or retirement account for themselves on their first attempt – and wouldn’t need to look up a brokerage account transfers. Unfortunately, this isn’t always the reality of the situation, especially if you’re fed up with your brokerage’s high fees, unresponsive customer service, or broken platform.

Luckily, online brokerage accounts have made it easier than ever before to transfer your assets to a new firm. Read on to learn the steps you’ll need to take to transfer an account from broker to broker. 

Step 1: Understand the Fees

Most brokers will charge you a few fees when you jump ship—the most common of which are a transfer fee to complete your transaction and a closure fee to finalize the removal of your account from their platform.

These fees vary significantly depending on the broker, but you can typically expect to be billed anywhere from $25 to $100 when transferring your assets. Some fees from some of the biggest brokers are listed in the table below:

The idea of blowing $100 to close your account got you down? Don’t fret quite yet—many brokers also offer reimbursement offers for new customers. Because they want your business, it’s common to have your new broker offer to cover the transfer and closing costs from your old firm. Remember to ask if your new broker is offering any specials—nine times out of 10, you can avoid paying any fees at all.

Step 2: Complete a Transfer Initiation Form (TIF)

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 (called the “receiving firm”) and your new broker can guide you in the process.

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

  • Your name
  • Address
  • 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:

Step 3: Validate your Request if Necessary

Some brokers will require you to validate your transfer before they will begin the process of moving your assets. This is typically done to ensure that the correct assets are transferred (in the event of a partial transfer) and to prevent fraud.

Your current brokerage may contact you to confirm that you do, in fact, want to transfer your assets. Be sure to validate your transfer in a timely manner to ensure that your assets are moved as quickly as possible if you are delivering firm requests it.

Step 4: Wait Patiently

After you’ve validated your request, your delivering firm and your receiving firm will work together to move your assets. All you have to do at this point is play the waiting game.

Although the asset transfer process is largely done online, you can still expect your assets to take about a week to appear in your new account. Keep in mind that transfers from entities that aren’t brokers (like credit unions or banks) can take more time to transfer and may be subject to additional fees. Your receiving firm can keep you updated on where your assets are—don’t be afraid to ask questions.

Step 5: Ensure Your Assets Have Made it to Your New Account

After your transfer is complete, make sure that all of your assets have made it to your new account. Keep a copy of your TIF and cross-check it with your new account.

If everything has made it, your process is complete! If not, contact your new broker immediately—there may be a delay in your transfer or there may have been an error on your TIF.

Other Things you Should Know

Keep these items in mind throught the transfer process.

1. You will lose access to your assets while the transfer is taking place

While your transfer is taking place, you will most likely lose control of your assets. Many brokers also “freeze” your assets during a transfer, meaning that you cannot buy, sell, or trade any of your assets until the transfer is complete.

This typically isn’t an issue, as transfers don’t usually take much longer than a week, but it’s something to remain aware of.

2. Your new broker can probably handle the transfer for you

If you are transferring an entire account between two brokers, your new broker may be able to streamline the process for you by asking you to sign an authorization form granting him or her temporary control over your assets.

Though this option is usually limited to the transfer of cash, bonds, and stocks of domestic corporations, it can greatly expedite the transfer process—and take some of the stress off your shoulders. Ask your receiving broker if this is a possibility for your asset mix.

3. Transferring a joint account requires extra steps

Keep in mind that the steps listed above only apply to assets that you solely own. Joint accounts will need verification from both parties in order to be transferred and may take additional time to complete.

Final Thoughts on Tranferring Accounts

Transferring your assets can be a pain—sometimes, it can feel like it’s easier to just stick with your current broker rather than go through the hassle of switching to a new account. However, the time you spend will hopefully pay off in the long run.

A broker that works with your lifestyle needs will give you more control over your financial well-being. This is why it’s important to carefully read up on all of your brokerage options before you make a commitment—a little planning now can save you a ton of headaches in the future.

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