With any research I have done on google, people will explain investing with the assumption that people have a basic understanding on the different types of financial systems. *I don’t*. With a brokerage account, do I just put the money in and let it sit to accrue interest, or do I need to do anything else?
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You need to do other stuff with it, although it can make a small amount of interest. Imagine you’re at a store buying something with cash. You pull out your wallet, take out $100 and put it on the counter. You haven’t bought anything yet, but the money has left your possession and is in the stores. You can get it back of course, but the store has the money. Once you buy something, the store will put your change on the counter for you to pick up. Same thing if you bring something to sell, money gets put on the counter. The store has the physical money, and you haven’t physically recieved anything yet
That’s kinda what a brokerage account is like. The money has left your bank, and is with the investment company, but you haven’t done anything yet. Its just a pile of cash that’s between spots. I have a vanguard account and if I buy an investment, it goes my checking ->vanguard brokerage-> investment. When I sell it goes investment->brokerage->checking. Or it can go to another investment so it can go investment->brokerage->other investment.
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