Opening Investment Accounts After Freezing Your Credit Reports Is a Huge Pain

Photo credit: Steven Depolo, CC BY 2.0.

So it turns out that if you freeze your credit reports (as recommended, post Equifax-hack) and put a fraud alert on your bank account (also recommended), opening investment accounts becomes a huge hassle.

I experienced a little bit of this when I moved; before I could sign up with my new internet provider, I had to unfreeze and refreeze one of my credit reports (so they could do a soft credit pull and prove I was credit-worthy).

I’ve also had to do extra phone calls with pretty much every service I’ve signed up for lately, to confirm I’m actually me. I don’t really understand why saying my name/address/SSN over the phone is somehow more trustworthy than typing it into a form, but I’m no security expert.

But I’ve had to do even more steps to get my various investment accounts up and running.

With Capital One Investing — which holds my old Roth IRA plus the new traditional IRA and personal investment account I just opened — I had to do a phone call to verify my information plus recite a code, sent via text, to prove that I was holding my own phone.

With HealthEquity — my HSA — I had to fax over my Social Security card and my driver’s license.

With Vanguard — which is where I’m going to rollover my TIAA 403(b) and potentially where I’ll open a SEP IRA — I have to print, fill out, and mail a packet of forms. I’m going to have to call TIAA before I do that, though, to confirm that I won’t need to fill out a packet of forms/fax a driver’s license/recite a code with them, too.

The Vanguard thing is frustrating enough that I’m tempted to just unfreeze my credit and reapply online, to see if it works.

Also, to answer the question I know you’re going to ask in the comments: I want to keep the personal investment account and trad IRA with Capital One Investing (instead of opening similar accounts with Vanguard) because the “transfer from bank account to investment account” process is so smooth. Since I’m going to be making those transfers every week, might as well keep ’em simple. The Vanguard IRA will just be a rollover IRA, to avoid commingling.

Next week I’ll let you know how my CPA responded to all my questions and whether I was able to put any money into any of these investment accounts!

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