How to Switch Brokers and Move Your Investments

Moving your investments from one brokerage firm to another doesn’t have to disrupt your investment strategy. With a plan in mind, it can be manageable. Most firms also use the Automated Customer Account Transfer Service (ACATS) system to simplify and speed up the transfer of assets. Here’s how to switch brokers and move your investments.

Have questions about choosing a new broker? You could consider reaching out to a financial advisor.

How to Switch Brokers: The First Steps

The first three steps will involve selecting a new broker, opening an account and making sure that all of your necessary documentation are in order. Here’s a closer look at each:

Select a new broker: Research and select a new brokerage that aligns with your investment goals and preferences. You’ll likely want to evaluate factors such as trading fees, customer service, available investment options and the platform’s accessibility. Reading reviews and comparing different brokers can help you make the decision that’s best for you.
Open a new account: Once you’ve selected a new broker, you can typically open an account by completing an online application, providing personal information (such as your Social Security number) and verifying your identity (often using your driver’s license).
Gather documentation: Before initiating the transfer, gather all of the necessary documentation you can from your current broker. Documentation likely includes your account statements, lists of your holdings and any relevant tax documents. Having this information can help streamline the transfer process and prevent any delays or other potential issues.

How to Switch Brokers – Moving Your Investments

Now, you’ll need to initiate and monitor the transfer to complete the process:

Initiate the transfer: To initiate the transfer, simply inform your new broker of your intention to move your assets. They can provide you with the necessary transfer forms, which you’ll need to complete and sign. These forms typically require details about your current brokerage account, including the account number and the types of assets being transferred. Most brokerages then use the ACATS system to facilitate the transfer of assets between firms.
Avoid trading and check for discrepancies: Once you submit the completed transfer forms to your new broker, they will then coordinate with your current broker to initiate the transfer. The new broker will handle the bulk of the transfer process. However, as the transfer process can take between a few days and up to a week, it’s important to refrain from trading during this time to prevent any complications or delays. After the transfer is complete, review your accounts to make sure that all assets were transferred correctly. If you notice any discrepancies, contact both brokers immediately.
Close the old account: Once all of your assets have been successfully transferred, you can contact your old broker to close your account. It’s a good idea to obtain confirmation of the account closure so that no residual fees or assets remain.

Things to Consider When Switching Brokers

Switching brokers can be a strategic move that enhances your investment experience and better aligns your financial goals. But before you make the switch, it’s important to take several things into account when it comes to how to transfer your assets.

Make sure you understand the transfer process and any associated costs. While many brokers cover transfer fees, some might charge a fee for moving your assets. You should also consider the time it takes to complete the transfer, especially if you’re an active or day trader, as your investments may be inaccessible for a short period of time.

Assess the new broker’s reputation and reviews to confirm that they are reliable and trustworthy, as well. You can verify that an investment broker is registered with regulatory bodies like the SEC or FINRA. You can also confirm that your new broker offers robust security measures to protect your personal and financial information.

Bottom Line

If you’re considering how to switch brokers, it doesn’t have to be hard. Most brokers use the Automated Customer Account Transfer Service system to streamline the process. Just be sure to do your research so that you understand the transfer process, and that you’ve chosen a new broker suited to your financial needs and goals.

Tips for Switching Brokers

Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Knowing how your investments will grow over time is an important part of planning your financial future. SmartAsset’s investment calculator can help see what your investments might look like in 10, 20 or 50 years.