Individual account
Also known as: single account, individual brokerage account
An individual account is a brokerage account owned and controlled by one person, who alone holds the account's assets and directs its activity unless they grant written authority to someone else. It is the simplest form of account registration and the baseline against which joint, custodial, and trust registrations are compared.
An individual account is a brokerage account registered in the name of a single person. That person is the sole owner of the securities and cash in the account and the only one who can authorize transactions or direct that assets be paid out — unless they grant trading or withdrawal authority to another party in writing. Distributions normally go to the owner, though third-party payments — a wire or check to someone else — are possible when the owner authorizes them and the firm's account agreement and supervisory procedures permit it.
Because ownership is undivided, the account holder alone bears the tax consequences: dividends, interest, and capital gains are reported under that person's Social Security number. The owner may grant someone else the ability to trade the account through a written third-party trading authorization or power of attorney, but granting trading authority does not transfer ownership. When the owner dies, the assets pass to the estate through probate unless a transfer on death (TOD) designation names a beneficiary directly.
Individual accounts sit alongside several other registration types that firms must distinguish at account opening. Joint accounts add one or more co-owners with equal trading rights, custodial accounts hold assets for a minor under an adult custodian, and trust or corporate accounts are controlled by a named fiduciary or officer. The registration chosen determines who may trade, who is taxed, and where the assets go at death, so it is captured on the new account form before any business is done.
Account registrations are a reliable exam topic. The SIE, Series 6, and Series 66 exams all ask you to identify who may trade an account, who can receive distributions, and how a given registration is treated when an owner dies — so know the individual account cold as the point of comparison for joint, custodial, and fiduciary registrations.
Key takeaways
- An individual account has exactly one owner, who controls trading and distributions unless they grant written authority — such as a trading authorization or power of attorney — to someone else.
- All income and gains are reported under the owner's tax identification number.
- A third-party trading authorization lets someone else place orders without giving them ownership.
- Assets pass through the owner's estate at death unless a transfer on death designation is in place.
- Registration type is recorded on the new account form and drives trading authority, taxation, and distribution at death.