Dear Liz: My brokerage recently sent an updated fee list. They now are charging $100 to close an account. That seems an incredibly high fee should I choose to move my investments somewhere else. The fine print says the fee will not apply to anyone who holds at least $5 million in qualifying assets. Well that certainly isn’t me. So they’re hitting those who have the least with a ridiculously high fee when it comes time to end the account. Is this typical across the investment industry?
Answer: Unfortunately, yes, but the usual fee is closer to $75.
Many brokerages have lowered their fees in recent years, with many eliminating commissions. But the account closure fee has stuck around, probably because most people don’t think about the costs of shutting down an account after they’ve opened one.
Just read your comment about cost to close brokerage account.I believe that Fidelity doesn’t charge any fee to transfer out or close account.I’m at Schwab,who does charge to close account,but they don’t charge to transfer assets without closing.So,a person could transfer out all their shares to Fidelity,leaving one share to sell,to avoid the closing charge.
Many brokerages have language saying they “may” charge an account closure fee. It may be helpful to ask your brokerage how these fees may be assessed.