People’s perceptions and enjoyment of gifts change over time. Children want endless hours of fun whereas adults tend to enjoy something different. One study showed that people’s outlook on gifts begins to become practical in their mid-20s.
Another survey found that 81% of respondents prefer getting gifts that they’ll actually use. It’s why self-care items, sweets, and books remain at the top of the list. Gift cards and money are also popular. But if you want to give a loved one a gift that keeps on giving, why not gift them stocks?
There are many reasons why a shareholder will transfer their stocks. They might be leaving the company or retiring. Shares can also transfer to someone else upon the original stockholder’s death, but they can also be given as a gift. The latter entails transferring shares to a recipient.
Does this interest you? Here are some options on how to transfer stock to another person as a gift.
Do a Broker Transfer
The first step in the process is to call your broker. They hold your brokerage account so they have to become involved. You can have them do a digital transfer of your stocks.
You’ll be doing some printing and scanning of documents if you opt to go digital. It’s because the law requires that the stockholder must sign off the transfer in writing. Make sure you have the following details on hand:
- Stockholder’s name and address.
- Stockholder’s account number
- Recipient’s name and address
- Recipient’s account number
- Recipient’s social security number
- Name and number of stocks to gift
- Recipient’s broker DTC number
It’s ideal for both parties to have the same broker. But this will still work even with different transfer agent services. The two brokers will need to communicate. This means you have to forego the surprise aspect of the gift.
Transfer the Share Certificate
The conventional way of holding stocks is to have them in a certificate form. Times are changing though. Most investors prefer a digital copy instead of a physical one. Stock transfer agent services can take care of them. When it comes to gifting, getting a physical share certificate is exciting. You can even have it gift-wrapped for added enjoyment.
You’ll need to go see your broker in person because they will act as guarantors for the share certificate transfer. They will also serve as witnesses as you sign your signature to approve the transfer.
Transfer on Death
You can also set things up so that your stocks are then transferred upon your death. It’s a bit morbid but can be a balm to a grieving friend or loved one.
The Transfer on Death option lets an individual receive assets from a benefactor. They won’t have to wait or go through probate to get the asset. This designation allows the stockholder to determine the percentage of stocks to give.
TOD designations are often used for stocks, bonds, and other investments. You’ll need a Transfer On Death Agreement to do this. Your broker can help you with this agreement. You will need to file a form naming the individual you want to gift your assets to.
Your brokerage firm will also handle the Transfer on Death process. They will wait until they’re notified of the stockholder’s death. Your broker will then ask the recipient of your choosing for a copy of your death certificate. They might also look for a stock power of attorney or an affidavit of domicile.
They need documents that will prove the account holder’s death. These documents will vary based on the kind of account. For example, if it’s a trust account or a single account.
Set Up a Custodial Account
You can also gift a child with stocks through a custodial account. You can open one in the child’s name but you will manage it. You can transfer your stock or buy some shares in their name. The young recipient can take over control of the account when they become of age.
Full-Service Stock Transfer Agent at Hand
Nothing beats Legacy Stock Transfer when it comes to high-quality stock service solutions. We’re a family-owned and operated stock transfer agent services company. Our company has been offering customized services since 1996. We help our clients streamline their operations. We can manage multi-channel communications and ensure compliance. Our transfer agents are the best and ready anytime. We offer transfer agent services. We also offer direct registration help and restriction removals. We can help secure CUSIP numbers and replace lost certificates. We also provide 24/7 online account access. Call us at 972-612-4120. You can also reach us here or at info@legacystocktransfer.com.