How to Move an Account from Ally Invest to Charles Schwab (and Vice Versa)
Do you have a brokerage account with Schwab? Would you like to give Ally Invest a chance? If so,
you’ve come to the right place. We’re going to show you how to move an investment account from
Schwab to Ally Invest (and from Ally Invest to Schwab if you’re in that situation) with as
little cost and time involved as possible.
Transferring from Charles Schwab to Ally Invest
The first step in moving an account from Schwab to Ally Invest is to open an account at Ally Invest if you don’t have one yet. This is really simple to do, and it’s a good idea to do it first just in case it takes a few days to get the account open and ready to accept a transfer. Sometimes a broker’s back office takes a few days to get a new account fully open.
Click here to access Ally’s online brokerage account application. Then click on the Open Account button. The account will need to be of the same type as your Schwab account (like joint account or Roth IRA), and the names on the two accounts must be the same as well.
The Ally Invest account could be either a robo or self-directed account. If it’s a robo account, only cash can be moved into it. If it’s a self-directed account, both cash and securities can be transferred in. If you transfer ETFs from a Schwab robo account into a self-directed account at Ally Invest (this is possible if you want to do it), keep in mind that you will be responsible for managing those new fund positions.
Once you have the Ally Invest account open that you want, it’s time to prepare your Schwab account for the upcoming move. This could take several days, depending on what assets you have at Schwab and whether you’re going to do a full or partial transfer. Generally speaking, a full account transfer requires more preparation.
For example, in a full transfer, you’ll need to close out any open orders and make sure all trades have settled. You may also want to zero out any margin balances you have.
Because you’ll be keeping your original account in a partial transfer, you can just ignore these issues. For a margin balance, make sure you don’t transfer out too much collateral to force a margin call from the old brokerage house.
There are two asset classes Schwab offers that Ally Invest doesn’t: futures and foreign stocks. Any holdings of these assets will have to be handled appropriately. You can either liquidate them, or leave them in your Schwab account while performing a partial transfer (don’t list them in the partial transfer), or move them to a backup Schwab account that won’t be part of the transfer to Ally.
One other caveat needs to be made before we proceed: Ally Invest uses Apex Clearing as its clearing firm, and Apex doesn’t accept some over-the-counter stocks. Before attempting to transfer any of these positions from Schwab into Ally Invest, you should contact the latter broker and ensure it will accept them.
With your Schwab account put in order, it’s time to request an account transfer. This is done with the receiving broker, which in this case is Ally Invest. Simply log into your Ally Invest account and hover over the My Accounts tab with your cursor. In the drop-down menu that appears, hover over Transfer Funds, and then click on Transfer an Account in the next window. This will pull up the broker’s digital transfer form.
At this point, you can choose either full or partial transfer. You’ll see a list of potential outgoing brokerage firms. Schwab’s logo is in this list. Be sure to click on Schwab’s logo.
With all details filled in correctly, Ally Invest will contact Schwab, and that will start the transfer. The two brokerage firms will take it from there.
If for any reason you would rather fill out a paper form, Ally Invest does have one. You can download this form, fill it out, and send it back to Ally Invest if you prefer.
Open Ally Invest Account
Open Ally Invest Account
Transferring from Ally Invest to Charles Schwab
Moving an account in the opposite direction will take on a similar odyssey. The first thing you need to do is get that Schwab account open if you haven’t done so already. As with any electronic transfer, the new account must be the same type as the old, and the names on both accounts must match.
If you have any option contracts, make sure your new Schwab account is approved for margin trading. And if they are in multi-leg strategies, your Schwab account will need to be approved for margin as well. Contracts in a transfer should have at least 2 weeks of life in them.
Prepping your Ally Invest account may be a little easier than prepping your Schwab account because there are fewer asset classes that Ally offers that Schwab does not. Schwab doesn’t offer forex trading, although forex positions can’t be moved in a brokerage transfer anyway. It is best to close out these positions or make sure they are in a discrete account at Ally.
Once both accounts are ready to go, log into your new Schwab account and hover over the Accounts tab. In the drop-down menu, click on Transfer Account. This will give you Schwab’s online transfer form. For the outgoing broker, you can select either Ally Invest or its clearing firm Apex Clearing.
You’ll need to supply your Ally Invest account number and other details. At that point, just submit the application and you’ll be all set. Schwab will ensure the assets in your Ally Invest account arrive safely in your new Schwab account (assuming they are eligible to be moved).
Comparison
Read detailed Ally Invest vs Charles Schwab Comparison.
How Long Does a Transfer Take?
An electronic transfer of cash and securities typically takes 5 to 7 business days to complete. This estimate is from the time a transfer request is submitted. It may take several business days to get an account open and to prepare the old account for the upcoming transfer. If a transfer is complicated, such as one including margin balances and penny stocks, it could take longer.
Cost of Transferring
Ally Invest assesses a $50 fee for each transfer (full or partial) to another brokerage firm. Moreover, Ally charges $25 to close an IRA, and this termination fee is charged in addition to the $50 transfer fee. Schwab does not currently refund other brokers’ transfer or termination fees.
Moving in the other direction, Schwab charges $50 for a full outgoing transfer and $25 for a
partial outgoing transfer.
Ally Invest will refund either of these charges if your transfer is worth at least $2,500.
Chad Morris is a financial writer with more than 20 years experience
as both an English teacher and an avid trader. When he isn’t writing
expert content for Brokerage-Review.com, Chad can usually be found
managing his portfolio or building a new home computer.
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