How to Open an Investment Account

  • January 4, 2019

Watch our video on how to open an investment account.

What Is an Investment Account and How to Open One

  1. Opening an investment account is what's needed to be able to buy and sell stocks or mutual funds. Have you set up an investment account? Investing in your future is one of the best things you can do for yourself. It's never too late or too early to start preparing for retirement. 

The world is changing and preparing for your future is necessary. Everyone should invest something! Here's the thing, It used to be that you could retire at 65 and not have to worry so much. Now people are working way past retirement age because they need to. 20-30 years ago this wasn't the case. 

When you're thinking about opening an investment account, you need to think about what kind of investment account you'd like to open. There are a few different kinds.

As a result, you want to pick the investment account best suited for you. It's never too late to invest. However, the type of account you choose can change based off your investing goals. You can always talk to your broker who has a registered and licensed financial adviser on hand to help you with your investments. 

We teach how to trade stocks in our trading service. The Bullish Bears are not teaching investing on our live streams, that is better left to the experts. We keep our investments separate from our trading accounts. NEVER mix a trade with an investment. They are two very different things and strategies.  Make sure to download our free candlesticks charts e-book and study on your schedule.

It can be overwhelming when you start researching an investment account. You're trying to understand the differences between them and which one you should open.

There are a variety of accounts such as retirement accounts, employer sponsored accounts and taxable accounts. There are pros and cons to each type of account.

Therefore, you want to make sure you understand each type of investment account and when to use them. Read our Stash App review to learn more about this investing app. We like stash for the beginner investor who is busy and doesn't have thousands of dollars laying around every month to invest. 

investment account

1. The Individual Retirement Account

One investment account to consider is the individual retirement account also known as an IRA. An IRA is a great way to save for the future as well as receive the added tax benefits that comes with an IRA account

It's important to know that because of the tax benefits of an IRA investment account, there are rules for how much you can invest in a specific year. There's also a restriction on how much money you can take out each year.

However, if you're using an IRA investment account as a retirement fund, leaving it be to let it grow is going to be the best option. There are a couple different IRA investment accounts.

A traditional IRA allows you to save for retirement and only pay taxes on the amounts you take out. Each year that you contribute to a traditional IRA, you can write that amount off on your taxes.

Since there is a tax benefit, there are rules for funding and using the traditional IRA. As a result, you'll want to check those out with your broker.

A Roth IRA is a lot like a traditional one with on big difference. A Roth IRA investment account allows you to save money you've already paid taxes on. As a result, when you withdraw money from a Roth IRA you don't have to pay taxes.

However, you can't write off the contribution on your taxes. These investment accounts are so popular because of the tax benefits they offer.

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2. Investment Account & Employer Plans

Many times employers offer a retirement investment account to their employees. Many times in the form of a 401K , a contribution match or an IRA.

If your employer offers an investment account then take advantage of it. You can roll it over if you leave your job and continue to save.

With a 401K you're putting a specified amount of your paycheck into a fun sponsored by your employer. However, you can decide how to invest the money even though your employer sponsors the investing plans.

Sometimes with a contribution match, your employer will match the amount of money you put in each month. They may also match it by putting in a percentage.

For example, if you put 4% of your paycheck into an investment account, your employer may match up to 4%. Sometimes they'll put in 2% for your 4%. It all depends on what they offer.

If your employer offers a contribution match plan, take full advantage of it. It's basically free money.

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investment account

3. What's Your Plan?

The type of investment account you open all depends on your investing plan. What are your long term goals? What are you looking to accomplish for your retirement? Write it down. Save a word or google doc somewhere. Go back to it monthly. Talk to friends, relatives, professionals. Think about it. Your plan may change over time.

These are a couple questions to consider when opening an investing account. If your employer offers certain accounts you may decide not to pursue opening an account on your own. It's a nice employee benefit when your employer offers this type of service.

Some of the members of the Bullish Bears Team worked for a fortune 50 company. One of the perks was a 15% discount on company stock. That's nothing to sneeze at! We took advantage of this discount, as it immediately showed returns upon purchase.

There are options open to you no matter what direction you decide to take. Just like with stock market trading, having an investing goal is important. 

It gives you something to work towards. As a result, you tend to make wiser choices on how you invest your money and what type of account you open as well as what you want to invest in. 

Be it mutual funds, ETFs, stock market trading, options or a portfolio that includes all of them. 

What Is the Best Investment Account for Beginners?

  1. TD Ameritrade
  2. E-Trade
  3. Fidelity
  4. Charles Schwab
  5. Interactive Brokers

If you're going to open an investment account on your own, the goal is to find a good investment firm. You're going to want a firm that explains the restrictions and benefits as well as the rules of investing accounts in an easy to understand manner.

Earlier in this article, we posted our Stash App review. If you're into technology and a hands on approach, this may be an investing app you'd be interested in.

There are more traditional places such as Vanguard, TD Ameritrade or Fidelity. There's no right or wrong firm to choose from. These are just a few of our favorites.

When you're looking to open an investment account, you want a place that offers mutual funds, ETFs as well as IRAs and 401K's.

You're going to want to pick an investment strategy. Your strategy will change depending on your age as well. When you're younger, you have the time to make riskier investments. As you age, you'll want to move into safer, less volatile investments. 

That's right, when you're older you want to protect your investments more because you're going to need them sooner. Fee's can be something to consider as well. Fee's can eat up some of your gains. Those fees may change based off of your investment plan so find out what the fees are as you make changes. 

Final Thoughts

Opening an investment account is one of the best decisions you can make for yourself. You will never regret preparing for your future. Or for your families future. Think long term. 10, 20, 30 years. Your future you will thank your past you. To learn about investing, read one of our favorite timeless books, the intelligent investor

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  • Avatar plsakunze@gmail.com says:

    If this was first part of Basic Stock Course, he was using terms I’ve never heard of without explaining or defining

  • Avatar Jewels3 says:

    I’ve been watching your live feeds for a couple months and have learned so much. Decided to finally start the course and I love that I learned something from the first video. You guys are great! I’m glad I came across you when I did! I’ve been ready for the next level and you guys have been doing that plus some!

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