Adding someone to your ETRADE account isn't as simple as clicking an "add user" button. It depends entirely on why you want to add them and what level of access you want them to have. ETRADE offers a few different ways to share access or ownership, each with its own implications. Let's break down the options and how to navigate them.
A Comprehensive Guide to Adding Someone to Your E*TRADE Account
Have you ever considered sharing the management of your investments, or perhaps planning for the future of your assets? It's a common need, whether you're bringing a spouse into your financial picture, setting up an account for a child, or simply granting someone limited authority to help manage your affairs. E*TRADE, now part of Morgan Stanley, offers several avenues for this, each serving a distinct purpose. Let's dive in and understand your options!
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| How To Add Someone To Etrade Account |
Understanding the Different Types of Account Access
Before you proceed, it's crucial to understand the different levels of access and account types available, as they have significant legal and financial implications.
Option 1: Joint Brokerage Account
This is the most common way to add another owner to your investment account. In a joint account, both individuals have equal ownership and control over the assets. This is typically ideal for spouses or partners who share financial goals and responsibilities.
Option 2: Authorized User / Limited Trading Authority
This option grants someone the ability to trade on your behalf, but they do not have ownership of the assets. This is useful if you want a trusted individual (like a financial advisor or a family member) to execute trades for you, but you retain full legal ownership and responsibility for the account.
Option 3: Custodial Account (UGMA/UTMA)
If you're looking to set up an account for a minor child, a custodial account is the way to go. You, as the custodian, will manage the investments for the child until they reach the age of majority (typically 18 or 21, depending on the state). The assets legally belong to the child, but you control them.
Tip: Read once for flow, once for detail.
Option 4: Power of Attorney (POA)
A Power of Attorney is a legal document that grants someone (your "agent" or "attorney-in-fact") the authority to act on your behalf in financial matters, which can include your E*TRADE account. This is often used for estate planning or in situations where the account holder may become incapacitated. A POA grants full control over the account.
Option 5: Beneficiary Designation
While not "adding someone" to actively manage the account, designating beneficiaries is a critical step for succession planning. This ensures that your assets are distributed according to your wishes upon your passing, without going through probate. This is typically done for retirement accounts like IRAs but can also be applied to brokerage accounts.
Now, let's explore the step-by-step guides for the most common scenarios.
Step 1: Identify Your "Why" and "Who"
Think carefully about your intentions. Do you want someone to co-own the account with you? Do you just want them to trade? Are you planning for the future of a minor or for your own incapacity?
Scenario A: "I want my spouse to have equal access and ownership of my investment account."
Solution: Joint Brokerage Account
Scenario B: "I want my trusted friend/family member to be able to place trades on my behalf, but I want to retain full ownership."
Solution: Authorized User / Limited Trading Authority (or potentially Power of Attorney for broader control)
Scenario C: "I want to set up an investment account for my child's future."
Solution: Custodial Account (UGMA/UTMA)
Scenario D: "I need someone to manage my financial affairs, including my E*TRADE account, if I become unable to."
Solution: Power of Attorney (POA)
Scenario E: "I want to ensure my investments go to specific individuals after I'm gone."
Solution: Beneficiary Designation
Once you've clarified your specific need, proceed to the relevant step below.
Step 2: Adding a Joint Brokerage Account Holder
Adding a joint account holder typically involves opening a new joint account or converting an existing individual account, though converting an existing individual account to a joint one is less common and often requires a new application.
Sub-heading 2.1: Opening a New Joint Brokerage Account
Visit the E*TRADE Website: Go to the official E*TRADE website (us.etrade.com).
Navigate to "Open an Account": Look for a prominent button or link that says "Open an Account."
Choose "Brokerage Account": When presented with account types, select "Brokerage Account."
Select "You and someone else": E*TRADE will typically ask if the account is "Just for you" or "You and someone else." Choose the latter for a joint account.
Complete the Online Application:
You and the other joint account holder will need to provide personal information, including:
Full names, addresses, and contact information.
Social Security Numbers (SSN) or Taxpayer Identification Numbers (TIN).
Dates of birth.
Employment information.
Financial information (annual income, net worth, investment objectives).
Be prepared to provide identification documents for both individuals, such as driver's licenses or passports, if requested.
Review and Sign: Carefully review all the information provided. Both account holders will need to electronically sign the application or print, sign, and mail it.
Fund the Account: Once the account is approved, you can fund it via electronic transfer, wire transfer, or by mailing a check.
QuickTip: Skim fast, then return for detail.
Sub-heading 2.2: Converting an Existing Individual Account to Joint (Less Common)
While some financial institutions allow converting individual accounts to joint, ETRADE typically prefers opening a new joint account*. If you wish to convert an existing individual account, it's best to contact E*TRADE customer service directly. They will guide you through the specific process, which may involve completing new account forms and potentially liquidating and re-establishing positions.
Step 3: Granting Authorized User / Limited Trading Authority
This option allows someone to trade on your existing account without becoming an owner. The process for this usually involves specific forms provided by E*TRADE.
Log In to Your E*TRADE Account: Access your online E*TRADE account.
Navigate to Account Management or Customer Service: Look for sections related to "Account Management," "Profile," "Settings," or "Customer Service/Support."
Search for "Authorized Trading" or "Limited Power of Attorney": E*TRADE may have a specific form or process for granting limited trading authority. Search their help articles or direct links within your account portal. You might find terms like "Limited Trading Authorization" or "Third-Party Trading Authorization."
Download and Complete the Required Forms: E*TRADE will provide a form that you and the authorized individual must complete. This form will typically ask for:
Your account details.
The authorized person's full name, address, SSN/TIN, and contact information.
The scope of their authority (e.g., can they only trade, or can they also view account statements?).
Notarization (Potentially Required): Depending on the level of authority granted and E*TRADE's policies, the form may require notarization to verify signatures.
Submit the Forms: Follow the instructions on the form for submission. This might involve uploading them securely through the E*TRADE portal, faxing them, or mailing original copies.
Confirmation: E*TRADE will review the submission and notify you once the authorized access has been granted.
Step 4: Establishing a Custodial Account (UGMA/UTMA)
Custodial accounts are specifically designed for minors. You, as the custodian, manage the account for their benefit.
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Visit the E*TRADE Website: Go to us.etrade.com.
Navigate to "Open an Account": Click on the "Open an Account" button.
Choose "Custodial Account": Select "Custodial Account" from the list of account types (often under "For a minor"). E*TRADE offers both UGMA (Uniform Gifts to Minors Act) and UTMA (Uniform Transfers to Minors Act) accounts. The best choice depends on your state and the types of assets you wish to include.
Complete the Application:
You (the custodian) will provide your personal information (name, SSN, address, etc.).
You will also provide the minor's information (name, SSN, date of birth).
Note: The assets legally belong to the minor, and once contributed, cannot be reclaimed by the custodian.
Review and Sign: Review the application and digitally or physically sign it.
Fund the Account: Deposit funds into the custodial account.
Step 5: Setting Up a Power of Attorney (POA)
A Power of Attorney is a serious legal document. While it's not an ETRADE form itself, you'll need to submit a legally executed POA document to ETRADE.
Consult an Attorney: It is highly recommended to consult with an attorney to draft a Power of Attorney document. They can ensure it meets all legal requirements in your state and accurately reflects your wishes regarding your E*TRADE account and other assets.
Execute the POA: The POA document must be properly signed, witnessed, and/or notarized according to your state's laws.
Contact E*TRADE Customer Service: Inform E*TRADE that you intend to submit a Power of Attorney. They will provide specific instructions on where and how to send the document.
Submit the POA: Send the original or a certified copy of the executed POA to E*TRADE. Do not send a regular photocopy unless specifically instructed.
E*TRADE Review and Approval: E*TRADE's legal department will review the POA to ensure its validity and compliance with their policies. This process may take some time.
Confirmation: Once approved, E*TRADE will update their records to reflect the POA, and your designated agent will be able to act on your behalf.
Step 6: Designating Beneficiaries
This step ensures your assets are distributed smoothly after your passing. This is different from adding someone to manage the account while you're alive.
Log In to Your E*TRADE Account: Access your online E*TRADE account.
Navigate to Beneficiary Information: Look for a section like "Beneficiary Designation," "Profile," or "Account Settings." This is typically found within the details of each specific account (e.g., your IRA, brokerage account).
Add/Edit Beneficiaries: You will be able to add primary and contingent beneficiaries.
Primary Beneficiary: The first person(s) to receive the assets.
Contingent Beneficiary: The person(s) who receive the assets if the primary beneficiary is no longer living.
Provide Beneficiary Information: For each beneficiary, you'll need their:
Full name.
Relationship to you.
Date of birth.
Social Security Number (SSN).
Percentage of the asset they will receive (if multiple beneficiaries).
Review and Confirm: Carefully review the designations before saving or submitting.
Keep Records: It's prudent to keep a record of your beneficiary designations with your estate planning documents. Remember to review and update them regularly, especially after major life events like marriage, divorce, or the birth of a child.
Important Considerations:
QuickTip: The more attention, the more retention.
Tax Implications: Adding someone to your account, especially as a joint owner or through a custodial account, can have significant tax implications. Consult with a tax advisor before making any decisions.
Legal Ramifications: Understand the legal responsibilities and liabilities associated with each type of account access. For example, joint account holders are both responsible for any debt incurred on a margin account.
Communication is Key: No matter which option you choose, open and honest communication with the person you are adding is paramount. Ensure they understand the scope of their access and responsibilities.
ETRADE's Specific Forms:* Always use the official ETRADE forms and processes*. Do not rely on generic financial forms.
Timeframes: The processing time for these changes can vary. Allow for several business days, or even weeks for complex legal documents like a Power of Attorney.
Frequently Asked Questions (FAQs)
Here are 10 common questions about adding someone to your E*TRADE account:
How to add a spouse to my existing E*TRADE account?
To add a spouse as a co-owner, you will typically need to open a new joint brokerage account with ETRADE and then transfer assets from your individual account to the new joint account. Directly converting an existing individual account to a joint one is less common and usually requires contacting ETRADE customer service for specific guidance.
How to grant trading authority to a family member on my E*TRADE account?
You can grant limited trading authority by completing specific E*TRADE forms, often found in the "Account Management" or "Customer Service" section of your online account. You'll need to provide their personal details and define the scope of their trading access.
How to set up an E*TRADE account for my child?
To set up an investment account for a minor, you would open a Custodial Account (UGMA/UTMA) through E*TRADE. You will be the custodian, managing the account until the child reaches the age of majority.
How to add a beneficiary to my E*TRADE IRA?
Log in to your E*TRADE account, navigate to the specific IRA account, and look for a "Beneficiary Designation" or similar section in your account settings. You'll then enter the primary and contingent beneficiaries' details (name, SSN, DOB, relationship, and percentage).
QuickTip: Skim the intro, then dive deeper.
How to give someone Power of Attorney over my E*TRADE account?
You'll need a legally executed Power of Attorney (POA) document (preferably drafted by an attorney). Once signed and notarized according to your state's laws, you must submit this official document to E*TRADE for their review and approval.
How to remove someone from a joint E*TRADE account?
Removing a joint account holder typically involves closing the existing joint account and opening a new individual account, or having the removed individual transfer their portion out. This is a complex process and usually requires direct communication with E*TRADE customer service and potentially legal advice.
How to transfer assets from my individual E*TRADE account to a joint account?
Once your new joint ETRADE account is open and approved, you can typically initiate an internal transfer of assets (cash and securities) from your individual account to the new joint account directly through the ETRADE platform's transfer tools.
How to check who has access to my E*TRADE account?
Log in to your E*TRADE account and navigate to your "Profile," "Account Settings," or "Security" section. There, you should find details about any linked accounts, authorized users, or other individuals with access permissions.
How to open a business E*TRADE account with multiple partners?
For a business account with multiple partners, you would typically open a Partnership Brokerage Account or a Corporate Brokerage Account, depending on your business structure. This process will require specific business documentation, including EINs and partnership agreements or corporate resolutions, and all partners will need to complete the application.
How to get help from E*TRADE customer service for adding someone to my account?
You can contact E*TRADE customer service by phone (typically a toll-free number found on their website) or through their secure messaging system if logged into your account. Be prepared to explain your specific need and account type.
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