Capital One Investing Account

Capital One Investing offers several types of accounts for its customers which are General Investment Accounts, Individual Retirement Accounts, Children’s and Custodial accounts.

General Investment Capital One Investing Account

These types of trading accounts can be opened as Individual or Joint Accounts and are designed to help people supplement and grow earnings by trading financial assets in various marketplaces around the world.  

Individual Accounts are opened by one person and managed by only that person, whereas Joint Accounts are opened by two people, each of whom can make account changes, transfer money and place trades independent of the other account owner.  

Joint Accounts include rights of survivorship that automatically transfer ownership rights to the other account owner when one passes away without the need to go through Probate Court estate proceedings. 

General investments can be made in stocks, bonds, mutual funds and other financial securities.  These types of individual trading accounts are straightforward and have no limits on how much can be put into the account or removed from it. 

Individual and Joint investment Account owners are able to utilize Capital One’s Express Funding option which allows traders to place “buy” orders even when they have insufficient cash in their trading accounts to cover the entire transaction.  There are limits to this option and additional costs are involved, but it allows traders to jump onboard potentially lucrative trading options without having the cash on hand to actually cover the purchase.  

Individual Retirement Capital One Investing Account 

Individual Retirement Accounts (IRAs) are investment accounts used for people to plan and save money for the day when they will no longer be working and earning a steady income. IRAs help investors build their futures with saved income that provides certain tax advantages to those who qualify.  The Internal Revenue Service regularly updates annual contribution limits, gross income requirements and other things related to IRAs, the details of which change occasionally and are available on its website or from your financial advisor or Certified Public Accountant (CPA).  Capital One Investing offers Traditional IRAs and Roth IRAs and the differences are as follows:

Traditional IRAs Capital One Investing Account 

Traditional IRA Accounts have no income limits for folks under the age of 70 and a half at the end of the year in which the IRA account is opened.  Account holders must have earned income (or have a spouse with qualified earned income) to participate in a Traditional IRA.  Contributions to these types of IRA accounts are often tax deductible and allow people to deposit as much as $5,500 annually for those under the age of 49 and up to $6,500 a year for those over the age of 50.  

Contributions to Traditional IRAs are tax exempt only if neither the account holder nor his or her spouse has a plan offered through their employer.  Those who do have employer sponsored IRA plans can deduct all or part of their annual contributions, depending on the total annual income of those individuals.   

Withdrawals from Traditional IRA accounts have to start by the age of 70 and a half (minimum required distributions) and any withdrawals transacted prior to reaching the age of 59 and a half may be subject to early withdrawal penalties. 

Traditional IRA withdrawals are taxed unless the contributions were not tax-deductible at the time they were made.

Roth IRAs Capital One Investing Account

People who open Roth IRA accounts must have earned income (or have a spouse with qualifying earned income) and are subject to the same age and annual deposit limits as Traditional IRAs, but those contributions are not tax deductible.  These funds are taxed right upfront which allows Roth IRA account holders to build tax-free savings for their futures without worrying about future increased tax rates. 

Withdrawals can be made from Roth IRA accounts at any time if the Roth IRA has been in existence for at least 5 years and the account owner is purchasing a first home or is at least 59 and a half years old and has not become disabled or passed away.  There are no required minimum withdrawals from Roth IRAs at any age.   

Withdrawals from Roth IRAs by account owners under the age of 59 and a half years may be subject to early withdrawal penalties.

Children’s Capital One Investing Account

Capital One Investing offers Children’s Accounts that are designed to help young people save money for their futures and are controlled and overseen by an adult until the child reaches the age of majority.  Capital One options for Children’s Account are Education Savings Accounts (ESAs) and Custodial Accounts. 

ESA Capital One Investing Account

Also known as “Coverdell ESAs,” educational savings accounts allow people to save up to $2,000 a year (if they meet income eligibility requirements) for a named beneficiary’s educational costs for primary, secondary and higher education tuition, books, uniforms and other qualified expenses.   

Contributions made to these accounts are not tax deductible and presently offer no tax breaks whatsoever.  Earnings realized in ESAs may not be subject to taxation, depending on various factors and ESA funds can only be used for qualified educational expenses. 

Custodial Capital One Investing Account

These type of investment accounts are opened by adults to help kids save money and plan for their futures.  State laws may restrict who can open a Custodial Account but they can generally be opened by any adult for the benefit of any minor child.  Only one child can be named as beneficiary and only one adult can be Account Custodian and that person will be responsible for overseeing and managing the investment account until the minor child reaches the age of distribution dictated by the state in which the child resides.  Withdrawals and a certain amount of earnings will be taxed at the minor’s rate and the named beneficiary minor is the owner of all account assets, as required by the Uniform Transfer to Minors Act (UTMA). 

Demo Capital One Investing Account

The Capital One Investing website is very basic, user friendly and targeted to new investors.  Presumably because of this, the firm does not offer a demo account for investors to practice trading assets in various marketplaces, which is a huge disadvantage of the trading website.