What is a brokerage account?
A brokerage account is an investment account that allows you to buy and sell a variety of investments, such as stocks, bonds, mutual funds, and ETFs. Whether you're setting aside money for the future or saving up for a big purchase, you can use your funds whenever and however you want.
What can you do with a brokerage account?
You can use your brokerage account to gain access to stocks and other types of investments. Opening a brokerage account is one of the first steps to building your personal investment portfolio. With this type of investment account, you can also:
- 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.
- Gain access to investment research, tools, and strategies.
How do I use my brokerage account?
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.
When you open a brokerage account with Schwab, you get to decide how to manage your investments. You can choose to handle your investments on your own, or take advantage of an advisor, or even explore automated investments—with Schwab, there are multiple ways to invest, so you can reach your goals according to your own plan.
Your brokerage account can help you with:
Trading stocks
Long-term investing
Retirement savings
Other savings goals
What are the Schwab brokerage account features?
Once your brokerage account is open, you can use the money you've deposited to start buying investments. However, just as there are different brokerage account ownership types, with Schwab there are also different features you can add to your account.
What are the Schwab brokerage account features?
How we do brokerage at Schwab
Whether you're ready to open an account or just exploring your options, Schwab's brokerage experience is built to support investors at every stage with powerful technology, low costs, and expert guidance.
Compare our investment accounts to see what's best for your investing needs
Ready to work toward your financial goals? Learn more about the benefits of a brokerage account and how it compares to other types of investment accounts.
Compare our investment accounts to see what’s best for your investing needs
| Schwab Brokerage Account | Retirement Account | Education Savings Account | |
|---|---|---|---|
| Best for | Flexible investing, any timeframe | Tax-advantaged retirement savings | Tax-advantaged education savings |
| Ways to invest | Individual stocks, ETFs, mutual funds, bonds, options, futures | Individual stocks, ETFs, mutual funds, bonds, options, futures | Pre-selected diversified portfolios from multiple fund families |
| Taxes | Taxable gains and income | Tax-deferred growth and tax-free withdrawals (depending on IRA type) | Tax-deferred growth |
| Fees1 |
No minimums $0 online stock/ETF commissions |
No minimums $0 online stock/ETF commissions |
No minimums/enrollment fee 0.20% to 0.82% annual portfolio expenses |
| Withdrawal flexibility | No penalties | Penalties for early withdrawal | No penalties for qualified expenses |
| Yearly contribution | Unlimited | Limited | Limited |
| Get started | Learn more | Learn more |
Types of brokerage accounts
If you have money set aside and are trying to find the right way to manage it, opening a brokerage account may be a good option for you. Learn about the types of brokerage accounts and how you can start investing.
A standard brokerage account allows you to easily deposit money and buy and sell investments through a brokerage. With this type of brokerage account, you'll be able to take advantage of penalty- and restriction-free withdrawals, no contribution limits, and more flexibility as market conditions change.
What are the different brokerage account ownership types?
When you open a brokerage account, you need to choose between an individual or joint brokerage account. Joint brokerage accounts are beneficial if you're looking to pool your investments with another person, such as a spouse or family member, and can be a way to simplify investment management and/or estate planning.
Individual brokerage account
An individual brokerage account has the name of one, and only one, account owner attached.
Joint brokerage account
A joint brokerage account is shared by two or more individuals. Joint brokerage accounts are most commonly held by spouses, but are also opened between family members, such as a parent and child, or two individuals with mutual financial goals, such as business partners.
There are three types of joint brokerage accounts:
Joint Tenants with Rights of Survivorship
Both owners have equal rights to this type of brokerage account. If one owner dies, the survivor will automatically receive the decedent's share of the account.
Tenants in Common
With this type of brokerage account, if one owner dies, there is no right of survivorship—instead, the decedent's share of the account will go to their estate.
Community Property
This type of brokerage account is owned only by a married couple. The assets are split 50/50 between each spouse, and if one owner dies, the decedent's share will go to their estate.
This type of brokerage account is only available in AZ, CA, ID, LA, NM, NV, TX, WA, and WI.
Frequently asked questions
Think about your goals, timeline, preferred investing style (DIY vs. advisory), tax needs, and the types of investments you want to access. This helps you choose between account types and features that best fit your needs.
A brokerage account allows you to buy and sell financial products like stocks, ETFs, mutual funds, and bonds. You deposit funds, then use those funds to invest.
Yes, you can open more than one type of brokerage account, such as an individual account and joint accounts, depending on your financial needs.
Brokerage accounts are protected by the SIPC for losses due to firm failure, up to $500,000. However, investments themselves are not insured. The Schwab Bank checking component is separately FDIC-insured. Learn more by visiting Account Protection.
- Cash account: You can only invest your own funds. Trades must settle before funds are reused.
- Margin account: You can borrow money against your holdings to invest more, but this comes with interest, risk of amplified losses, and added complexity.
A cash account is often best for beginners, since it's straightforward and doesn't involve borrowing or margin risk. It allows you to invest only the money you have, making it easier to manage and less risky.
