If you’re not familiar with Robinhood, it’s an app that allows you to buy and sell stocks, commission-free.
I think it’s a good way for new investors with limited capital to get started investing.
However, there is one policy that Robinhood has that I have a problem with. Robinhood does not allow you to name a beneficiary of your account.
In the event that you pass away, Robinhood will “work with the executor of the estate to collect proper documentation and dissolve the account appropriately”.
Now if you’re single, or don’t have any children, this may not be an issue for you. As a father, however, I have a problem with this.
My main brokerage account is with TD Ameritrade. My daughter is my beneficiary on all accounts. If something happens to me, all she has to do is send them the death certificate and my accounts will be transferred to her. There is nothing else she has to do.
I want my loved ones to go through as little as possible when that day comes. So for this reason, I will not be making Robinhood my main brokerage account. If you are a parent, I’d advise the same.
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