How to Open a Brokerage Account

Welcome to Markets With Manward. I'm Andy Snyder. I want to cover a topic that is probably the biggest topic I get from new investors. How do you start a brokerage account? What do you need to do?

So we're going to start a new account through Merrill. I've never started an account with them before. I'm doing that on purpose to show you how easy it is to start a new account. I don't have ties with Merrill. It's not my favorite brokerage account by any means. So we can go in here totally blind, and I can show you what to do.

All right, so now I'm sharing my screen and you can see it's pretty easy. All we're going to do is click "Open an account." We want an individual account. So we'll click that and it tells us everything we need: Social Security number, a valid email address, employment information and just general financial information. And what they're looking for is just a general outlook on our overall wealth and our investing knowledge. They want to know: Are you a beginner, intermediate or professional? That way when we go to open up more advanced accounts or do more advanced things in our account like options trading, the system knows where we're at with that.

So we'll just click "Continue." We are not an existing client, so we'll click "I'm not a new client" and we'll begin the application. All right, so fill out your information. This is basic personal information. I'll fill mine in then we'll go to the next step.

So it's basically just asking for your basic household income again so it knows what sort of account, whether you're an accredited investor, whether you've had options experience, that sort of thing. If you put in your annual income is $0 versus $3 million, it's going to offer you different things, and it's going to let you do different things with your account.

If you have $10 to your name, it is not going to let you do a whole lot of speculative options trading. Whereas if you have $10 million, then it might let you do a little bit more. So here it's asking our trading experience, we'll go right in the middle. I have traded with cash only. What year did we start investing? We'll just say right after the dot-com crash. What have you invested in? Stocks, mutual funds, bonds options. And no, we don't authorize Merrill to disclose anything to corporate issues. We'll keep our information to ourselves.

We're not going to click any of this. We don't want any of the fancy bells and whistles. All I want you to do is be able to go in and make a trade. So we'll click "Continue." We're almost done. We'll start with our user ID here. I have to write this down so I remember. Terms and conditions, we'll speed read all that. We'll click that we read it. Continue. We're almost done. Tax certification. Yep. We're going to pay our taxes and no, there's no reason for them to hold them from us. Click continue. More fine print, continue. Submit the application. So step three of three is done. It's submitting the application and very shortly we'll have an account.

All right. And here it is, your application is approved. We even have our account number there. So, the next step is to transfer cash. There's a lot of ways you can do that.

You can send a check, a transfer directly from your bank account, roll over an IRA. We're going to skip that and we're going to go right to our account and you'll get to see the actual trading page and where you get to do everything. So this is our actual platform where we can trade. You can see we have no account balance yet, but again, if you transfer some money to do that. But really what you need to understand here, that where the magic happens is right up here in the trade. Again, I've never been on this account or this brokerage platform before, but you can see how simple it is. Go to "Trade," hit "Stocks and ETFs" and then it just opens up a menu where you can start making those trades.

So let me just go through quickly what the mechanics of that would look like. So we'd select, we'd want to buy a stock. We could put our symbol right here. We could just do one chair. You could do a market order or limit order and again, you can get into all that stuff in later videos. I have some videos on some of this already but you know, for this case, we'll just do a market order which just puts our buy order out onto the market and fills it.