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How do you borrow money from a brokerage account?

In many cases, you simply transfer the funds from the account to a bank, for example, and you’ve established a margin loan against your account. Each brokerage sets the minimum amount of equity in the account that must be available in order to borrow. Some firms may require only $10,000, but others may require $25,000 or more.

Should I borrow against my investments?

Borrowing against your investments is usually a cheaper way to take out a loan when compared to credit cards or bank loans, since the loan is backed by collateral. But you’ll want to check how much a portfolio line of credit costs at your institution.

Should you borrow against your assets?

Borrowing against your assets may also come with additional risks, since the assets need to maintain a certain amount of value for the duration of your loan. "In general, this type of leverage should be used when you're confident you can repay the loan quickly,” says Lou Gentile, advanced planner at Fidelity.

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