Navigating My Brokerage and Joint Account Options
Summary of User’s Concerns and Solutions:
- Main Problem: The user needs to fund their individual brokerage account but is confused because the account is labeled as the funding account for their crypto account, and they want to short-sell Boeing quickly.
- Solution: To short-sell, the user must enable the margin feature on their brokerage account, which allows trading with unsettled funds without incurring Good Faith Violations (GFVs).
- Solution: The user can review the risks associated with margin trading and learn how to add margin to their account through provided links.
- Solution: Fidelity does not currently support Zelle for person-to-person transfers, but alternatives like PayPal and Google Pay are available.
- Solution: Fidelity Bloom accounts can only be individual accounts, but the user can create a joint brokerage or cash management account for shared savings with their girlfriend.
- Solution: Depending on their needs, the user should consider whether a brokerage or Cash Management Account (CMA) is more suitable for their joint savings, with CMAs designed for everyday spending and brokerage accounts for trading and investing.
Here’s the full thread
Hey There! I need to fund my individual brokerage account, but it says it is the funding account for my crypto account. Do I need to make a new individual account to use it as it’s own brokerage? I need to short boeing as soon as possible!
It looks like I need a margin account to short sell, how do I do that?
If the account funds haven’t settled because I just added 1.3k to my account, does a short sell order incur a good faith violation when it executes?
Hey there! Thanks for reaching out to us on Discord.
Based on your previous message, it sounds like you were able to transfer funds to your account. Typically, when you go to transfer funds into your account, and your brokerage account is linked to your Fidelity Crypto account, you will see “Funding account for Fidelity Crypto” next to it.
If you wish to short-sell in your brokerage account, you will need the margin feature enabled. As a little background, a margin account lets you leverage securities you already own as collateral for a loan to buy additional securities. With it comes risk, and it may not be suitable for every investor. We always recommend reviewing the risks and familiarizing yourself with how the feature works. You can learn more about the feature by clicking the links below:
Using Margin: https://www.fidelity.com/learning-center/trading-investing/using-margin
Trading FAQs: Margin: https://www.fidelity.com/trading/faqs-margin
Once you have familiarized yourself with the feature and understand its risks, you can add margin by clicking the following link:
Add Margin (Login required): https://digital.fidelity.com/ftgw/digital/features/marginandoptions/home
Margin allows you to increase your borrowing power and trade with unsettled funds and shares without worry. When you place your trades in type margin, you are not subject to Good Faith Violations (GFVs). A GFV occurs when you sell a security purchased with unsettled funds before the settlement of the initial sale. Liquidating a position before it was ever paid for with settled funds is considered a “good faith violation” because no good faith effort was made to deposit additional cash into the account prior to the settlement date. You can learn more about cash trading violations here:
Avoiding cash account trading violations: https://www.fidelity.com/learning-center/trading-investing/trading/avoiding-cash-trading-violations
If you have additional questions, please let us know! 🟢
Thank you so much! I’ve been working a lot with my account today and realized I don’t actually need my wells fargo or sofi account, I had always thought it was necessary to have a bank and a brokerage, but all of the features like credit score tracking and net worth monitoring can be done in the fidelity “full view” mode, so I’m thinking about making fidelity my only and closing my other accounts. My only questions are, what can I use to replace Zelle? YOu guys do like paypal and apple pay i think for peer to peer, but I only have google pay and no paypal. I also want to open a joint account with my girlfriend, can we do that with the fidelity bloom account or only individual brokerages? Can I open two fidelity bloom accounts with her so she can have her own savings, I have my own bloom account, and we have a joint savings/brokerage for travel?
Thanks for following up with us, @Executive Chef.
Currently, Zelle is not supported as one of our person-to-person transfer choices. We take feedback like yours seriously, so I’ll go ahead and pass your interest along to the appropriate team.
We do offer PayPal alongside Venmo and digital wallets, including Google Pay, as part of our mobile payment choices. I’ll include a link to more information about these person-to-person payment methods below.
Fidelity Mobile Payments: https://www.fidelity.com/spend-save/mobile-payments
You can also review our deposit methods here: https://www.fidelity.com/customer-service/deposit-money
Currently, Fidelity Bloom accounts are only available as Individual accounts and can only have one authorized user for debit cards. The rationale behind this is that the Bloom accounts were created to help individual spending behaviors and goals.
As an alternative, you can create a joint Brokerage or Cash Management Account (CMA). To open a joint account, simply select “Joint” on the “Account Ownership” page during the account opening process. That said, if your girlfriend decides she wants her own account, she would need to open one independently.
Please let us know if more questions come up. We’re happy to help. 🟢
Thank you so much for the helpful reply! Between the cash management and brokerage accounts, which do you think is best for savings meant for the 8-16 month range? Medium liquidity, doesn’t need to be available at a moments notice. I was thinking about a 3 fund account for a brokerage or just SPAXX for cash management which I think is the standard.
I intend to plan out my fidelity accounts like:
Short Term Gains Brokerage, with margins and options to react to market price action with 2-4 month strategies
“Hopes n’ Dreams” Bloom savings acct for house, college, car etc. Strategy is growth above S&P, move into leveraged etfs during bull markets and depressed blue chips during bears. seeking 4-8 year returns. Currently all in a Vanguard large cap growth etf. If fidelity has something better I’d love to try it out.
Bloom Spending account is structured for a monthly $300 deposit from my savings, this sets a hard limit for my monthly spending and is where I pay off my credit cards. I tried to set spending goals for new year’s and didn’t meet them so this is my solution lol.
I have a Fidelity Go Roth IRA and a self-managed Roth IRA which is basically just a forever hold on microsoft and NVDA
Then I want to start a joint savings with my gf, and a joint charitable account to reduce our tax liability once we actually have the income to make it worth it. Just have the gains compound until then.
So my basic question is just should I have a brokerage or CMA for our joint savings
Let’s start by going over the purpose and design of each account, as they do have two different designs. Unlike a standard brokerage account, which is designed for trading and investing, the Cash Management Account (CMA) is a brokerage account designed to help you manage everyday spending and cash management. Because of their differing designs, there are some key differences. To review a few, CMAs are not eligible to have margin; however, CMA debit cards are eligible for automatic ATM fee reimbursement at participating ATMs (Fidelity Brokerage account debit cards are not).
The link below explores these in more detail side by side.
Features by Account: https://www.fidelity.com/spend-save/features-by-account
With that said, the decision is ultimately up to you but if you’re looking for input and opinions from real Fidelity clients I recommend checking out our official Fidelity Investments subreddit, r/FidelityInvestments. 🟢
Thank you so much for all of your help! I’ve decided to actually close my CMA and just have my paychecks direct deposit into my bloom savings, then I’ll do a scheduled deposit of $300 on the first of the month to my spend account and have the rest on a recurring investment.
You are most welcome. Please reach out to us anytime you need us. We’re here and happy to help! 🟢