Run it yourself · step by step
How to turn it on.
Every 401(k) does this a little differently, but the shape is the same. Here is the Schwab PCRA version, from Schwab's own guides. Takes about fifteen minutes the first time.
1. Start in your 401(k), not at Schwab
Go to your 401(k) website, the site where you see your balance. Look under investment options for brokerage, self-directed, or PCRA. Most 401(k)s put an "Enroll" or "Open account" link right there. Some send you to schwab.com/pcraopen instead; your 401(k) website will say. For Schwab's application, you'll need your Social Security number and date of birth.
2. Open the PCRA
The application is online with an electronic signature. Schwab usually issues the account number instantly; a few 401(k)s take a business day before the first transfer is allowed. If your 401(k) has both pre-tax and Roth money, some recordkeepers enroll each separately.
3. Move money in from your 401(k)
You don't send money to Schwab. You go back to your 401(k) website and transfer from your regular funds into the brokerage option, the same way you'd move money between funds. Schwab sets no minimum for the account. Some 401(k)s set their own, so it's worth a quick check: a minimum first transfer, or a minimum that has to stay in your regular funds. Some allow a transfer only once a week; some cap the brokerage option at a share of your balance. The money lands in the account's cash sweep within a couple of business days.
4. Invest
Once the cash is there, you trade at schwab.com, in the Schwab app, or by phone at 888-393-PCRA. Listed stocks and ETFs are commission-free online, and some other trades cost money. Your 401(k) may limit what the brokerage option can hold. A few allow mutual funds only, so read its rules once.
5. Moving money back
Sell to cash in the brokerage option, then transfer back to your regular funds on your 401(k) website. Withdrawals and loans always come from your regular funds, not from the brokerage option.
What it costs
Schwab charges no account fee. Online trades of U.S.-listed stocks and ETFs are $0, thousands of no-transaction-fee mutual funds are $0 to buy online, and new-issue CDs and Treasuries are $0 online. A trade placed by phone with a Schwab broker is $25, and some mutual funds charge up to $49.95 to buy. Your 401(k) may add its own fee. Nothing here is a fee to us. Tell us your employer and we'll find out what yours charges.
What's never allowed
Margin, short sales, futures, currencies, private placements, physical metals and collectibles are out in every PCRA. Gold and commodity funds are usually fine. Employers can exclude more; your 401(k)'s rules for the brokerage option say what.
Built from Schwab's public PCRA materials. Your 401(k)'s own documents govern. If anything above differs from your 401(k)'s rules, your 401(k) is right. Not investment advice.
Stuck on step one?
Tell us your employer and what you saw on your 401(k) website. We'll find the page.
Have a question?
Ask us anything about the Schwab PCRA in your 401(k). We answer every question, usually the same day. Got an email from Aimee? Just reply to it.