by KaNeil Menlove, VP Operations

Hello everyone! After working ten years at Paragon, I was asked to write my first newsletter article. I was joking around with everyone in the office and told them that it might be another ten years before I write my second newsletter article! Ha!

While I wish there was a more lighthearted topic to write about, I thought it would be very helpful to write about the transition from TD Ameritrade back to Schwab. Some of you may remember the transition we made as firm from Charles Schwab to TD Ameritrade about five years ago. Personally, the transition was daunting for me. We had seven banker boxes as well as seven large boxes filled to the brim with all the necessary paperwork, envelopes, and postage to get it done. Over the course of several months, we worked through the boxes. We painstakingly moved approximately 350 accounts from Schwab to TD Ameritrade. You can imagine the mixed feelings I had when I heard that Schwab bought out TD Ameritrade.

One of the biggest questions I had about the move back to Schwab was whether we would have to go through the same process of re-papering all the accounts. I was delighted to find out that there is NO paperwork involved in this transition from TD to Schwab.

This got me thinking about some of the other questions our clients might have about this move back to Schwab. So, for the remainder of my article, I’ll be answering some of the most common questions we’ve been receiving. If you have a question that isn’t listed, please feel free to reach out, and we’ll find the answer for you.

What paperwork is involved in moving my account to Schwab?

Like I mentioned above, there will be no paperwork involved with this transition. This will be all done behind the scenes between TD Ameritrade and Charles Schwab.

Will I receive a new account number at Schwab?

Yes, TD Ameritrade account numbers are nine digits long, whereas Charles Schwab account numbers are only eight digits. As a result, all TD accounts moving over will receive a new eight-digit account number. About a month before the transition, you’ll receive a Key Information packet in the mail from Schwab, which will include your new account number.

Can I go back to my old Schwab account number?

Unfortunately, no. When we moved from Schwab to TD, all of the old Schwab accounts were officially closed out.

When will my account be officially at Charles Schwab?

The official move will take place over Labor Day weekend in September. On September 5th, if you try to log into www.advisorclient.com, you will be directed over to Schwab Alliance.

What if all my accounts are already at Charles Schwab?

Great! You won’t have to worry about this transition.

I have an automatic withdrawal on my account. How will that be impacted?

According to the information I’ve received, your account will be set up the same way it currently is when it gets moved over to Schwab. For example, if you have a monthly withdrawal scheduled for the 10th of every month, starting in September, it will still be processed from your Schwab account.

What if I need cash out of my TD Ameritrade account right before the transition?

You can still withdraw cash out of your TD Ameritrade account until Friday, September 1st at 8:30 pm Eastern. After that, we’ll have to go through Charles Schwab to process the withdrawal.

What if I need to make some changes to my account?

We can still make changes to your account until August 18. After that, certain account opening and maintenance requests will be suspended until the transition is completed. These requests include address changes, beneficiary updates, and demographic information. Once the accounts have been transferred, we can update them at Schwab.

I received an Account Notification Letter from TD Ameritrade. Do I need to take any action?

No, the letter is simply notifying you that your account will be transferred to Schwab over the Labor Day weekend.

What statements should I expect from Schwab and TD?

During the month of September, you’ll receive two statements. One from TD Ameritrade showing all your positions and cash that were transferred to Charles Schwab, and another from Charles Schwab showing the positions and cash in your new account.

What tax forms should I expect in 2024?

For the tax year 2023, you’ll receive two different 1099s. One from TD Ameritrade before the conversion and one from Charles Schwab after the conversion.

Will I receive additional information from Schwab or TD leading up to the transition?

Yes, about a month before the transition, you’ll be prompted in AdvisorClient to create new Schwab Alliance login credentials. If your AdvisorClient credentials qualify, you’ll have the option to retain your existing user ID or create a new one. Additionally, you’ll receive a Key Information packet in the mail from Schwab, which will include your new Schwab account number and other important details about the transition.

Do I need to do anything right now to prepare for the transition from TD to Schwab?

One of the best things you can do right now is to log in to Advisorclient.com and ensure that all your information is correct. Verify your mailing and physical addresses, birthdate, beneficiaries, direct deposits, and Social Security Number. Please make sure all your information is accurately listed.

Is there a website I visit for more information?

Absolutely! You can always visit https://welcome.schwab.com/alliance for more details. This website provides a timeline, answers to frequently asked questions, and much more information.

I know this is a lot of information. My hope is that with this knowledge, it can help you as we approach the transition between TD Ameritrade and Charles Schwab. I would also like to reemphasize an earlier point: if you have any questions that were not listed above, please reach out, and we will get an answer for you.

We genuinely appreciate all of you as clients. It is both a pleasure and an honor to serve as your financial advisors. Please don’t hesitate to contact us if you have any questions or concerns about the upcoming transition back to Charles Schwab or your accounts.

Thank you!