How to Open a Brokerage Account Without Leaving Your Couch (2025)

As you stretch out on the couch to binge-watch your Netflix guilty pleasures, it dawns on you: You’ve paid off most of your debt. You’ve done a great job at saving. You have a 401(k) that’s inching its way toward respectability. Now, maybe it’s time to set your sights on investing in the stock market beyond your 401(k).

To do that, you’ll need a brokerage account. While that may sound daunting if you’re a beginning investor, don’t be intimidated. You can have one up and running in no time, and guess what? You won’t even have to leave that comfy couch to do it.

What Is a Brokerage Account?

A brokerage account is an account where you can put money that you want to invest. You can open a traditional or Roth IRA if you’re investing for retirement or a taxable investment account.

You can choose to invest your money in stocks, bonds, mutual funds and more. From there, you work with the licensed brokerage firm that actually invests your money for you. The firm acts as a middleman between investors and sellers.

How to Open a Brokerage Account in 4 Simple Steps

If you’re ready to open a brokerage account, follow these four steps to start investing in no time.

1. Decide How Much Investment Help You Need

Not all brokerage accounts are equal. Some come with all the bells and whistles including a personal financial adviser. Others follow a more DIY approach. Step one to opening up a brokerage account is to do your research and find out which type will be a good fit for how you want to invest.

Here are two basic types.

Managed Account

A managed account is a type of brokerage account that comes with some investment management. That means that either a human financial adviser or a robo-adviser will help to manage your accounts.

Pros

As the market fluctuates, account managers can make changes in your investments to maximize your gains and minimize your losses based on your predetermined preferences and risk tolerance. Like it or not, they probably know more about the market than you do.

Cons

Those advisers are not free. The average fee for a human financial adviser is about 1% of the managed assets, i.e. your money, up to the first $1 million dollars invested. It may not seem like much, but that eats into your profits a bit.

Discount Brokerage Account

If you have studied up and you’re ready to take on your investments on your own, you may want to sign up for a discount brokerage account. You can still invest in the same products. You just need to be prepared to make your own choices, though some discount brokerages offer robo-advisers.

Pros

You keep that percentage. Some online brokerage accounts may charge a fee for each trade you make, but many of them don’t do that anymore. The online competition is stiff, so you really want to shop around.

Cons

You’ll have to learn how to navigate the website, which in some cases can be a bit daunting. You’re also on your own in choosing your investments.

2. Find an Investment Account That Works for You

Once you’ve decided if you want to go the managed or online route, it’s time to find the account that is the best match for you. As you shop around, here are a few things to consider:

  • Minimum balance: How much are you planning to invest? Some accounts have a minimum balance requirement. Make sure you find one that will fit comfortably with the amount you are willing to invest.
  • Research and education tools: If you’re looking at an online account, do you want it to have tools to help you learn more about investing and research the best investments out there for you?
  • Fees: Keep your eye open for fees. These companies need to make money somewhere. You want to be sure that it’s not coming out of your account in ways you didn’t expect.
  • Ease of use: Play around on the firm’s website to get a feel for how easy to use it is. Your money is at stake, you want to be comfortable with your brokerage account.
  • Human vs. robo-adviser: Do you like the idea of a robo-adviser running all of the algorithms to keep your account at peak performance, or do you prefer a more personal touch?

3. Apply for Your Brokerage Account

You’ve done your due diligence. You’ve figured out how to open a brokerage account. You’ve found the account that is going to be perfect for how you want to operate. It’s time to hit the gas. Click on that “Apply now” button and get started!

Here’s what information you can expect to provide to get your account set up.

  • Personal info: Yes, they’ll probably ask for your Social Security number, address, phone number, and maybe a little about your financials and assets. That’s to be expected and it should be perfectly safe.
  • Tax status: Are you a single filer? Married filing jointly?
  • Risk tolerance: How adventurous are you willing to be with your investments? Bigger risks can mean bigger returns, but a higher chance of losing money, too.

4. Deposit Money and Start Investing

That’s it. Once you’ve done the research, picked your brokerage account and finished the application, it’s time to get to work.

If possible, the best method to add money into your new account is to link your bank account directly to it. That makes it easy to move money back and forth. If you don’t like to link accounts, you can likely use a debit card or even a check.

Investing can be a great way to grow your money. It is never foolproof, though. Understand that you are risking your money when you invest, but you can also manage those risks.

You’ve paid down debt and saved up money. Now it’s time to take the next step. Luckily for you, you won’t actually need to step away from the couch to do it. Binge away.

Make your money work for you: Sign up for our investing bootcamp and learn everything you need to know to get started with investing.

Tyler Omoth is a freelance writer covering topics from personal finance to career advice and even lawn care. His work has been featured on TopResume.com, Writersweekly.com and more. He is also the author of over 70 educational books for children and a proud parent of twin toddlers.

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How to Open a Brokerage Account Without Leaving Your Couch (2025)

FAQs

Why should no one use brokerage accounts? ›

If the value of your investments drops too far, you might struggle to repay the money you owe the brokerage. Should your account be sent to collections, it could damage your credit score. You can avoid this risk by opening a cash account, which doesn't involve borrowing money.

Can you open a brokerage account in person? ›

Follow these four steps to set up a brokerage account: Decide what type of account you want to open based on your goals for your money, such as if it will be for retirement or nonretirement purposes. Fill out the online application or visit a local branch to open the account in-person, if available.

How to open a brokerage account for beginners? ›

  1. Step 1: Decide How You Will Use Your Brokerage Account. ...
  2. Step 2: Evaluate How the Brokerage Can Help You Reduce Risk. ...
  3. Step 3: Choose the Best Online Brokerage Account. ...
  4. Step 4: Start the Application Process. ...
  5. Step 5: Fund Your Account. ...
  6. Step 6: Simulate Your Trading Before Going Live.

What to do once you open a brokerage account? ›

Once you've opened the account, you need to deposit or transfer funds before you can invest. That sounds complicated, but these days, it's pretty simple to link your bank account with a brokerage account online.

Is there any downside to opening a brokerage account? ›

Downsides of a standard brokerage account

Since it's a taxable account, you'll have to pay taxes on earnings in your account, including capital gains and dividends.

How much money can you safely keep in a brokerage account? ›

Holding cash here is appropriate if you plan to spend the money within a few days or would like to quickly place a trade. Assets in your brokerage account are protected up to $500,000 per investor, including a maximum of $250,000 in cash by SIPC in the event a SIPC-member brokerage fails.

Where is the best place to open a brokerage account? ›

NerdWallet's Best Brokers for Beginners of August 2024
  • Robinhood: Best for Beginner Crypto Investors.
  • Charles Schwab: Best for Trading Platforms.
  • Vanguard: Best for Index Funds and ETFs.
  • Webull: Best for Mobile Investing App for Beginners.
  • J.P. Morgan Self-Directed Investing: Best for In-person Customer Support.

Do you pay taxes on brokerage accounts? ›

Taxable brokerage accounts. An ordinary brokerage account that is not a retirement account is a taxable investment account. If you make money because your investments go up in value, or because your investments pay you dividends or interest, this income will be taxed.

Should I keep all my money in a brokerage account? ›

If you are OK with possibly losing some of your cash in exchange for a good chance of earning a generous return on your investment, then a brokerage account is a better choice. If it's critical you have the money -- say, because it's for a down payment for a home you're buying soon -- choose a savings account.

How much money do you need to start a brokerage account? ›

Many brokerages don't have minimum starting deposits or ongoing balance requirements. That means you could open a brokerage account and start investing with whatever funds you have—whether that's $100 or $1,000.

How much money is needed to start a brokerage? ›

Typically, you should budget for start-up costs of at least $10,000 if you are going for an independent real estate brokerage business. If you are considering opening a brokerage under a franchise, you are looking at $200,000 in start-up costs.

What is the most basic type of brokerage account? ›

For any type of brokerage, the most basic account is a cash account. This allows you to buy investments using the money deposited in the account. However, you can't sell short, buy on margin, trade options, or take advantage of other more sophisticated products.

Can you take money out of a brokerage account whenever you want? ›

Many investors open a brokerage account to start saving for retirement. However, the flexibility of this type of account means you can withdraw at any time and use the funds for shorter-term goals, too, such as a new house, wedding, or big remodeling project. Your brokerage account can help you with: Trading stocks.

Is it smart to have a brokerage account? ›

Brokerage accounts have more flexibility.

You can take money out of a brokerage account at any time and for any reason—just like you could with a regular bank account—without paying an early withdrawal penalty. You have to wait until age 59 1/2 to take money out of a 401(k) or IRA without penalty.

Is a brokerage account better than a Roth IRA? ›

A Roth IRA is meant for retirement savings, while a taxable brokerage account is better for investing money that you may need before retirement. It can also be a good way to supplement your retirement savings if you're already maxing out your retirement accounts.

Why not to use a broker? ›

A Broker May Not Source the Best Deal for You

Many home buyers simply assume that a broker can deliver a better deal than they could get on their own, but this is not always the case. Some lenders may offer home buyers the very same terms and rates that they offer mortgage brokers (sometimes, even better).

Do I really need a brokerage account? ›

Opening a brokerage account is one of the first steps to building your personal investment portfolio. Buy and sell stocks, mutual funds, ETFs, and other securities. Take advantage of potential long-term growth. Set aside money for your retirement, or other goals like college tuition or a down payment.

Is it better to invest with or without a broker? ›

Do you need a broker? The short answer is no—you don't need a living, advice-giving, fee-charging broker (although you shouldn't rule them out). You do, however, need a brokerage—the online storefront where you purchase stocks, bonds, exchange-traded funds (ETFs), and other investments.

What is a disadvantage of having a brokerage network? ›

Question: A disadvantage of having a brokerage network is thatYou have more access to differemt career opportunities. The information obtained might not be relevant to you:The information obtained tends to be redundant. You are more vulnerable to groupthink.

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