Individual Brokerage Accounts

WHAT IS A BROKERAGE ACCOUNT?

A Brokerage Account is an investment account that allows you to purchase stocks, ETF’s, bonds, crypto, other assets through a brokerage. An Individual Brokerage Account belongs to you while a Joint Brokerage account may be shared with a spouse and a Custodial Brokerage Account is owned by your children. There are three types of Individual Brokerage Accounts: 

• Standard Brokerage Account
• Margin Brokerage Account – An Account that lets you borrow money against your assets within the account.
• Retirement Brokerage Account – 401(k), IRA, or similar. 

WHO CAN GET A BROKERAGE ACCOUNT?

Any U.S. Citizen 18 or older can qualify for an individual, joint, retirement, or margin account. Most brokerages may require a minimum investment amount to get started, while others don’t. You can also have a Custodial Brokerage account for your children under 18. In a custodial account, the money belongs to your child, but you can invest money on their behalf until they have access to their money at age 18. Using the links below, sign up for any of these brokerages and receive cash or a free stock just for getting started. Next, watch a few quick Youtube videos showing you how to buy and sell stocks, ETF’s, and other assets within these platforms before you start investing.

WHAT ARE THE CONTRIBUTION LIMITS?

• There are no contribution limits. 

WHEN CAN I WITHDRAW MY FUNDS?

• You can withdraw your funds right after your sell/trade your assets, whether they are stocks or ETF’s. If you sell during trading hours, this is immediate. If you try to sell when the market is closed, you will need to wait until the next day. Be aware that some brokerages may temporary freeze trading during times of market volatility. While it’s rare, you may not have access to your money at times.

WHAT ARE THE INCOME LIMITS?

There are no income limits to contribute to an Individual or Joint Brokerage account, unless it is a retirement IRA. 

HOW MUCH OF MY CONTRIBUTIONS ARE TAX-DEDUCTIBLE?

• Your losses are tax-deductible when you sell your assets. 
• Your gains are taxed when you sell your assets. 

CAN YOU HAVE BENEFICIARIES?

You can have beneficiaries. They will have the same tax-obligations you would have had. The cost basis on your investments do not change.

ADVANTAGES & DISADVANTAGES

ADVANTAGES	DISADVANTAGES
Your losses are Tax-Deductible	You will need to pay income taxes on dividend income and gains.
Flexible investing options	The brokerage can freeze trading, limiting access to your money.
No penalties for withdrawing.
Potential to yield better returns than a savings account.
You can teach your children investing at an early age with custodial accounts.

Affiliate Link Notice: This post contains affiliate links, which means I may earn a small commission at no additional cost to you if you decide to purchase or sign up for a product through my referrals. While you can sign up through any other means, it would help support the blog if you sign up through my links. Thanks.