Adding bank account to brokerage

[minimax130]

I just opened an account with Schwab on Friday, and I entered a checking account to transfer funds over, however, it's not showing up. Do I need to wait one or two business days? I don't see that mentioned anywhere and thought to ask.

[Jluke]

They will probably do the test deposits of a few cents for you to confirm.

nothing is quick nowadays when setting up a new account for security reasons

[disneysteve]

Somewhere in the fine print it probably mentioned how it works. They need to verify the account, which might include a couple of test deposits. Or it might just take a day or two.

[minimax130]

I thought I read that they normally verify accounts instantly, however, it may take 1 or 2 business days to verify the bank account. I suppose being that my bank is local, it might take longer, come to think of it.

[kork13]

Worst case, call your brokerage & ask (or use a chat function if they offer it). But unless they use a verification service like Plaid, it won't be an instant update.

[srblanco7]

Recently I added my bank account to my 401k account to enable electronic funds transfer for withdrawals. They had a 15 day "waiting period" before I could do an ACH withdrawal. Enough time to mail me a letter advising that a bank account had been linked to the 401k.

[myrdale]

When I set up my Roth IRA (not with Schwab) I seem to remember it taking a day. I entered the routing/account number. They did two separate deposits (they are small, $0.34 and $0.78 or something similar). I had to input the deposit amounts, those were withdrawn and the account was complete.

[james.hendrickson]

And one thing to bear in mind is security. Having a bank account linked to your brokerage account adds risk.

For example, my brother was traveling to Europe, and he got his brokerage account hacked - the scammers tried to add a bank account and liquidate his stocks. The auto blocks were able to prevent it from happening, but adding connectivity adds risk.

[disneysteve]

And one thing to bear in mind is security. Having a bank account linked to your brokerage account adds risk.

For example, my brother was traveling to Europe, and he got his brokerage account hacked - the scammers tried to add a bank account and liquidate his stocks. The auto blocks were able to prevent it from happening, but adding connectivity adds risk.

That's true, but not linking your bank to your brokerage probably introduces far more risk. I'd much rather do a direct electronic bank to broker transfer (or broker to bank) to move money around rather than having to send or receive a paper check through the mail.

[myrdale]

my brother was traveling to Europe, and he got his brokerage account hacked

Was this a case of using public wifi?