How to Transfer Accounts between M1 Finance and Schwab
Moving an investment account from M1 Finance to Schwab or the other way around is easier than you might think. With the Automated Customer Account Transfer Service (ACATS), it’s now a simple process.
Transfer From M1 Finance to Schwab
Step 1: Consider the cost of an ACATS transfer. M1 Finance charges $100 for each transfer out, plus an extra $100 if it closes a retirement account. For example, transferring a Traditional IRA would cost $200. Schwab may reimburse this fee.
Step 2: If the fee is okay with you,
open a new securities account at Schwab. Only securities can be transferred through ACATS, so cryptocurrencies can’t be moved. You can choose either a robo or self-directed account, but it must have the same tax structure (like a SEP IRA or joint account) and the same name.
Step 3: Get the Schwab account ready for the transfer. If there is a margin balance in the M1 account, add margin trading to the Schwab account.
Step 4: Prepare the M1 Finance account. This step takes a bit more effort. Make sure all trades are settled and cancel any open orders. If you have any cryptocurrencies, decide whether to sell them, leave them behind in a partial transfer, or move them to another M1 account not involved in the transfer.
If you are moving the M1 account to a robo account at Schwab, you’ll need to sell everything, as Schwab’s Intelligent Portfolios only accept cash transfers.
Step 5: Once both accounts are ready, you can start the transfer. For an automated account, it might be best to sell everything and move the cash from M1 to Schwab. If you are transferring securities, use the ACATS system.
To do an ACATS transfer, log in to the Schwab website and click on the Move Money link at the top. In the drop-down menu, select transfers and payments. On the next page, select the option to transfer an account. Search for the outgoing brokerage firm by DTC number. If your M1 Finance account begins with GM, use code 1497. Otherwise, use code 0158. Enter the code in the search field and find the outgoing broker. When you’re done, submit the transfer request.
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Transfer From Schwab to M1 Finance
Step 1: Again, consider the cost of the account transfer. Schwab charges $50 for a full transfer out and $0 for a partial transfer. M1 Finance does not refund fees from other firms.
Step 2: If Schwab's fees are acceptable to you,
open an M1 Finance account. Follow the same rules as mentioned earlier about matching names and account types.
Step 3: Prepare the M1 Finance account.
Step 4: Get the Schwab account ready. This may take more time, as many assets at Schwab aren’t available at M1 Finance. M1 Finance does not support bonds, mutual funds, short positions, futures, options, or foreign stocks. These need to be managed the same way as cryptocurrencies.
Although a robo account can be transferred out of Schwab, only cash can be sent. Cash can be transferred through ACATS, but it may be simpler to sell everything and transfer the cash via ACH. Selling in a taxable account or withdrawing from a tax-deferred account may have tax consequences. Consult a tax advisor.
Step 5: Request the transfer. This can be easily done on the M1 Finance website. Click on the
Move Money button on the M1 dashboard after signing in. On the next page, select the option to transfer an account from another brokerage. You can choose either a partial or full transfer on this screen.
On the next screen, specify the outgoing brokerage house. Schwab's name and logo will appear
automatically, so click on the pre-populated link. Follow the instructions and submit the transfer.
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How Long Does a Transfer Take?
Schwab estimates 5 to 16 business days for an incoming transfer. M1 Finance estimates about 5 to 7 business days for transfers in the other direction.
Updated on 9/18/2024.
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