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How to Open Your First Brokerage Account

A brokerage account is the first step into taking your investing and financial affairs into your own hands. An account allows you to buy and sell stocks, bonds, mutual funds, etfs and other investment instruments.

Brokers typically charge a fee per trade but the past decade has been a race to the bottom with many brokerages offering free trades. Three popular options are Schwab, Fidelity and TD Ameritrade.

Factors to be considered include the types of services, fees, account minimums and access to in person advice.

Step 1. Decide on the type of account you want

Will this account be a personal account or a retirement account? There are personal accounts, IRAs, Roth IRAs with the primary difference being between the taxing of contributions and withdraws. Please reference for a more detailed explanation of accounts to find the right fit.

Step 2. Fill out the account form

This can be done online and will typically require your personal information including, name, date of birth, social security number, contact information and purpose of account. The process is simple and may take up to 10 minutes the account should be open within 24 hours.

Step 3. Familiarize yourself with the platform

Fidelity, Schwab and TD Ameritrade all have apps to trade from your phone, websites to execute trades, and potentially a software that can be downloaded as well. Pick a stock, ETF or mutual fund that you would like exposure to, type in a small amount, and execute your first trade. It’s as simple as that!

Step 4. Build and monitor your portfolio

Congratulations! You have purchased your first stock, etf, or mutual fund. The next step is paying attention to what is driving the price of your asset. Are quarterly earnings around the quarter? Are there talks about trade embargos with China affecting importers? Are the markets waiting to hear what the Fed will say? Don’t worry, this is a lifelong education and journey. You are in the game.

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