How to Open a Second Account in Interactive Brokers: Complete Step-by-Step Guide
Setting up a second account within your existing Interactive Brokers profile is something I get asked about constantly. Whether you're planning ahead for your children (like I'm doing for my upcoming little one), want to separate different investment strategies, or need distinct portfolios for specific goals, having multiple accounts under one login can be incredibly powerful.
I've been using Interactive Brokers as my primary broker for years, and one of the reasons I stick with them is their global flexibility. When I moved from Europe to the UAE, they transferred my account seamlessly without forcing me to sell anything. That kind of continuity is crucial when you're building long-term wealth.
Today, I'm walking you through exactly how to set up that second account because, honestly, it's not as intuitive as it should be on their platform.
Interactive Brokers Dashboard
Why You Might Want a Second Interactive Brokers Account
Before we dive into the how-to, let me explain why this feature is so valuable:
For Future Parents: Unfortunately, Interactive Brokers doesn't offer true custodial accounts outside the US. So if you want to invest for your children, you'll need to create a separate account under your name that you can eventually transfer to them.
Portfolio Separation: Maybe you want one account for aggressive growth investments and another for conservative dividend plays. Or perhaps you need separate accounts for different tax strategies.
Family Financial Planning: You might want to manage investments for different family members or life goals without mixing everything together.
The beauty is that all these accounts live under one login, making management simple while keeping your investments organized.
Step-by-Step: Opening Your Second Interactive Brokers Account
Step 1: Navigate to Account Settings
This is where most people get stuck because the option isn't where you'd expect it to be.
Log into your Interactive Brokers account
Look for the small icon in the top-right corner (not the obvious settings menu)
Click on "Settings" from the dropdown
Scroll down to find the "Trading" section
Click on "Open an additional account"
I know this seems hidden, and it took me a while to find it the first time too. IBKR could definitely make this more obvious.
Step 2: Choose Your Account Type
You'll see several options here:
Individual Brokerage Accounts (this is what most of us want)
Joint Accounts (if you want shared ownership with your spouse)
Institutional Accounts (for business purposes)
For a children's investment account or personal portfolio separation, choose "Individual Brokerage Accounts," then select "Individual" (single account holder).
Step 3: Complete the Application
The good news is that IBKR pre-populates most of your information from your existing account, so you won't start from scratch.
Key decisions you'll need to make:
Account Type: I always recommend choosing "Cash" over "Margin," especially for children's accounts. You don't want leverage when you're investing for the long term.
Investment Objectives: Be honest about your goals. For a child's account, I typically select:
Growth
Preservation of capital
Income generation
Additional Products: You can add options, futures, and other complex products, but for most people (especially children's accounts), stick to the basics.
Stock Yield Enhancement Program: I skip this for children's accounts. While you might earn a small amount lending out popular shares, there's slightly higher risk involved, and I prefer keeping things simple for long-term investing.
Step 4: Verification Process
Here's where things can get a bit tedious. IBKR will ask you to verify your identity and address again, even though you already have an account with them.
You have two options:
Streamlined verification using your phone's location
Manual document upload if you're traveling or the automated system doesn't work
In my case, I was in Europe when setting this up (despite my UAE address), so I had to go the manual route. Sometimes their automated systems are picky about bank statements too, so don't get discouraged if you need manual review.
Managing Your Multiple Accounts
Once approved (usually within 24 hours), you'll see both accounts when you log in. Your main account will be listed first, with your new account underneath.
Customizing Account Names
The new account will have a generic name, but you can customize it:
Go to Settings
Select the account you want to rename
Find "Account Alias"
Enter your preferred name (I used "Child 1" for demonstration)
Save your changes
Now you can easily distinguish between your accounts.
Setting Up Automated Investing
This is where the real power comes in. For a child's account, I recommend setting up recurring purchases:
Navigate to recurring orders
Select your child's account
Choose your ETF (I typically go with an S&P 500 ETF for simplicity)
Set up monthly purchases (not weekly, to minimize commission impact)
For my own portfolio, I invest weekly, but for children's accounts, monthly makes more sense to avoid commissions eating into returns.
My Personal Investment Strategy for Children's Accounts
Since I'm setting up an account for my upcoming child, here's my approach:
Single ETF Focus: I'm going with a broad market S&P 500 ETF. Simple, diversified, and historically reliable for long-term growth.
Monthly Automation: Set it and forget it. Every month, a fixed amount automatically purchases more shares.
Long-term Perspective: This account will run for 18-20 years without me touching it. The power of compound growth over that timeline is incredible.
No Complexity: No individual stocks, no options, no fancy strategies. Just consistent, automated investing in a proven index.
Important Considerations and Limitations
Geographic Restrictions: Remember, this isn't a true custodial account outside the US. The account remains in your name until you decide to transfer ownership.
Tax Implications: Speak with a tax professional about how multiple accounts might affect your situation, especially if you're investing across different countries.
Transfer Process: When your child reaches adulthood, you'll need to work with IBKR to transfer account ownership. Plan for this in advance.
Currency Considerations: If you're investing in different currencies across accounts, be mindful of exchange rate impacts.
Why I Choose Interactive Brokers for This
After years of using various brokers, IBKR remains my top choice for several reasons:
Global Flexibility: When life takes you to different countries, IBKR moves with you. This is crucial for long-term investing.
Low Costs: No monthly fees, minimal commissions, and access to global markets.
Reliability: They're one of the largest and most established brokers worldwide.
Technology: Once you get past the learning curve, their platform is incredibly powerful.
Multiple Account Management: As we've seen, managing several portfolios under one login is seamless.
For those just starting with IBKR, yes, it can feel overwhelming at first. But the investment in learning their platform pays off significantly as your portfolio grows.
What's Next?
In my upcoming content, I'll show you exactly how I'm setting up the automated investment strategy for my child's account, including the specific ETF selection process and how to optimize the recurring purchase schedule.
The key is starting early and staying consistent. Even small monthly contributions can grow into substantial wealth over 18-20 years thanks to compound growth.
If you're planning for children or want to separate your investment strategies, don't let the complexity of opening a second account hold you back. Follow these steps, and you'll have it set up in no time.
Internal Links
For more IBKR guidance, check out the detailed comparison of Interactive Brokers and why you might want to consider using multiple stock brokers in your strategy.
If you're new to ETF investing, my guide on ETF fees and their impact on returns will help you choose the right funds for your long-term strategy.
FAQs
Can I open multiple second accounts in Interactive Brokers? Yes, you can open several additional accounts if needed. This is useful if you have multiple children or want to separate different investment strategies.
Are there any fees for additional accounts? No, Interactive Brokers doesn't charge monthly fees for additional accounts, just like your primary account.
Can I set up automatic transfers between my accounts? While you can transfer funds between your accounts, automatic recurring transfers aren't currently available. You'll need to manually move money when funding your second account.
What happens to the account if something happens to me? Like any investment account, this would be handled through your estate planning. Make sure your will and beneficiary designations are updated accordingly.
Can I give my spouse access to the child's account? You can set up joint account access when creating the account, but both account holders must be adults and complete the verification process.
How long does account approval typically take? Usually 24-48 hours, though it can take longer during holidays or if manual document review is required.
Can I change the account type after it's created? Some changes are possible, but switching from cash to margin (or vice versa) typically requires contacting customer service and may involve additional approval processes.
DISCLAIMERS. I am not a financial advisor. This video, and the ideas presented in it, are for entertainment/educational purposes only and should not be construed as financial or legal advice. You, and only you, are responsible for your investment decisions. This video, post & article should not be construed as investment advice. Capital at risk. Affiliate Disclosure: This description contains some affiliate links, meaning that I may earn a small commission if you click through and use these links, at no additional cost to you. IBKR disclosure: https://go.smartmoneywithkai.com/ibkr-disclaimer
How to Open a Second Interactive Brokers Account
GET MY FREE WEEKLY NEWSLETTER
Crisp, actionable tips on investing & all things money delivered straight to your inbox. No fluff, just the good stuff to fuel your financial growth.
