Where to Sell Acorns Investments & What You Should Know
Learn to sell your small, diversified investments. Understand the complete process, from locating assets to handling financial considerations.
Investments, sometimes referred to as “acorns” for their potential to grow from small beginnings, represent a portion of one’s financial growth. Understanding the process and implications of selling these diversified assets is an important step in managing personal finances.
Identifying Your Invested Assets
Small, diversified investments frequently include fractional shares, which represent a portion of a single stock, or shares in exchange-traded funds (ETFs) and mutual funds held in small quantities. Many individuals hold these types of assets within micro-investing platforms or traditional brokerage accounts. Understanding the specific nature of these holdings is the first step before initiating any sale.
These assets are typically held within a brokerage account, a robo-advisor platform, or direct investment accounts. Accessing your account statements or logging into your online dashboard will provide a comprehensive overview of your current holdings. This ensures that you are aware of all the investments associated with your portfolio.
Executing Investment Sales
Selling investments typically involves logging into your brokerage or investment platform. Once logged in, you navigate to your portfolio or holdings section to select the specific asset you wish to sell. Most platforms offer a clear option to “sell” or “trade” the security, initiating the transaction process.
You will have the option to place either a market order or a limit order. A market order executes immediately at the best available price, while a limit order allows you to specify a maximum or minimum price at which you are willing to buy or sell. After selecting your order type and quantity, you will confirm the details of the transaction. The sale will then be placed, and the proceeds will settle within one to three business days, depending on the security and platform.
Understanding Capital Gains and Losses
Selling investments can result in either a capital gain or a capital loss. A capital gain occurs when you sell an asset for more than its original purchase price, while a capital loss happens when you sell it for less. The tax treatment of these gains and losses depends on how long you held the investment. This distinction is crucial for accurate tax reporting.
Investments held for one year or less are considered short-term capital gains or losses and are typically taxed at your ordinary income tax rate. Conversely, assets held for more than one year are classified as long-term capital gains or losses and often qualify for more favorable tax rates. Capital losses can be used to offset capital gains, potentially reducing your overall tax liability. If your capital losses exceed your capital gains, you may be able to deduct up to $3,000 of the net loss against your ordinary income in a given year, with any remaining loss carried forward to future tax years.
It is also important to consider the “wash sale” rule, which prevents investors from claiming a loss on the sale of a security if they repurchase a substantially identical security within 30 days before or after the sale. This rule ensures that investors cannot generate artificial tax losses without genuinely changing their investment position. Understanding these rules is important for proper tax planning when liquidating investments.
Post-Sale Financial Actions
After an investment sale is executed, the proceeds from the transaction are typically credited to your brokerage account. While the sale may appear immediate, the funds usually take one to three business days to “settle” before they are available for withdrawal. This settlement period is a standard industry practice, ensuring all aspects of the transaction are finalized. Once settled, you can typically initiate a transfer of these funds to a linked bank account.
Most investment platforms offer various withdrawal methods, including electronic transfers directly to your checking or savings account. Maintaining accurate records of all your investment sales is important for tax purposes. Your brokerage will issue Form 1099-B, “Proceeds From Broker and Barter Exchange Transactions,” which details the gross proceeds from your sales, and often includes cost basis information. This document is provided to both you and the Internal Revenue Service (IRS) and is essential for accurately reporting your capital gains and losses on your annual tax return.