When people think of brokerage accounts and investing money, nonprofits typically don’t come to mind. You may not even know that nonprofits can invest funds or why they would. However, many nonprofits do have brokerage accounts, and yours can, too. If your organization wants to improve its cash management and earn more large donations, opening a brokerage account can be an impactful first step.
In this guide, we’ll break down everything you need to know about brokerage accounts for nonprofit organizations, including:
Managing your nonprofit’s finances is a complex process, especially when it involves navigating a type of account you’ve never used before. Let’s dive into the details to help you feel prepared to open a brokerage account for your nonprofit and understand the best options available to your organization.
A nonprofit brokerage account is an investment account that an organization can use to invest funds, receive stock donations, and grow its reserve funds.
Instead of only holding cash like a regular bank account, brokerage accounts can hold stocks, bonds, and mutual funds in addition to cash. These accounts are managed by a brokerage firm, online broker, or other investment advisor that handles the logistics of trading and processing stocks for you.
Yes, nonprofit organizations can open their own brokerage accounts. Not only that, but maintaining a brokerage account is a key practice for helping to grow your nonprofit’s financial sustainability.
While an individual or company may use an investment account to make a profit, the purpose of a nonprofit brokerage account is to have a greater impact by receiving and managing high-capacity gifts for the organization’s cause with the goal of greater financial sustainability. By asking for stock donations and investing in low-risk, highly liquid investment strategies, these non-cash gifts can help to grow your organization’s financial capacity to weather economic changes and devote more to your mission.
Ultimately, brokerage accounts help nonprofits effectively steward their finances, promoting organizational stability and longevity.
Opening a nonprofit brokerage account comes with many benefits, including giving your organization the ability to:
Together, all of these factors can help your organization achieve greater financial sustainability long term.
If you’re excited about investing or improving your cash management with a brokerage account, take time to develop your nonprofit’s Investment Policy Statement (IPS) before you dive in. An IPS outlines specific rules and governance policies you’ll use to manage any investments you make, including stipulations for how donor funds can be used. You can create this document with the help of a nonprofit investment advisor or by using a template like Infinite Giving's free IPS template.
Along with cash, brokerage accounts can typically hold stocks, bonds, mutual funds, treasury bills, Certificates of Deposits (CDs), and other cash equivalents. Check with your specific brokerage account provider to verify the assets you can hold.
While most brokers and account providers do not charge a fee to open or maintain a nonprofit brokerage account, other fees may apply. For instance, Infinite Giving does not charge any setup, broker, or admin fees. However, if you use our cash management services, your account may be subject to a 0.65% fee on assets under management (AUM).
Nonprofits can open brokerage accounts with traditional banks, brokerage firms, or specialized nonprofit investment advisors by submitting an application and moving money into the account. Jump to our how-to section for detailed steps.
Nonprofits have a few options when opening a brokerage account. You can choose a traditional brokerage firm like Fidelity or Schwab, which offer specific nonprofit brokerage accounts alongside their other options. However, these accounts tend to have high minimum balances and more difficult application processes.
To make the process easier, consider working with a nonprofit investment advisor like Infinite Giving instead. These fiduciary partners can open a brokerage account for you in as little as three business days and ensure that it meets your organization’s needs.
Ready to open a brokerage account for your nonprofit? Follow these three steps to get started:
There are a variety of firms, banks, advisors, and online platforms that offer brokerage services for nonprofits. However, not every bank and advisory firm works with nonprofits, so be sure to find one that welcomes tax-exempt entities. Do extensive research on any brokers you consider, as you’ll be trusting them to manage large amounts of your organization’s funds.
As you weigh your options, consider important factors like:
To help you make an informed choice, we’ll go deeper into the pros and cons of two main options: going the traditional route and partnering with a specialized nonprofit investment advisor.
In the past, most nonprofits’ only option was to open an account with a big bank or brokerage firm. Now, more specialized advisors and platforms exist to help nonprofits open brokerage accounts and manage their funds effectively.
However, you can still choose to open a brokerage account with a traditional brokerage firm like Fidelity or Schwab if you determine that’s the best fit for you. Just keep in mind that this option can come with substantial drawbacks, such as:
On the other hand, you have the option to partner with a specialized nonprofit investment advisor like Infinite Giving who opens a brokerage account for you and takes extensive work off of your plate.
By working with Infinite Giving, you can access benefits like:
Plus, choosing this option means you’ll have years of nonprofit expertise on your side. These advisors are bound by fiduciary responsibility to know the ins and outs of nonprofit finances and understand what drives your decision-making. With this insight, they can provide you with an all-around better brokerage account experience.
No matter which option you choose to open a nonprofit brokerage account, the application process follows the same basic structure:
However, the length of this process and the work involved on your part can vary greatly depending on who you open your account with. Let’s break down some key differences between the application process for traditional firms and Infinite Giving:
To prepare for the application process, make sure you have all of the necessary documentation on hand along with approval from internal stakeholders. Meet with your board and nonprofit leadership to discuss the implications of applying for a nonprofit brokerage account and ensure that everyone’s on the same page before moving forward.
Once your nonprofit’s brokerage account is open, you can begin adding funds. As mentioned earlier, you may need to move some funds upfront to open the account. Be sure to check with your firm or provider to verify these requirements. Then, you can supplement these original funds by transferring reserve funds from other accounts and soliciting stock donations.
Now that you have the infrastructure in place, you’re ready to accept stock donations and publicize the option to donors. With Infinite Giving, the process of accepting stock gifts works like this:
Be sure to spread the word about this new giving option by adding information to your Ways to Give page and promoting stock donations across marketing channels. Consider conducting individual outreach to donors you think would be particularly interested, too.
Choosing to open your investment account with a nonprofit investment advisor instead of a traditional brokerage firm can significantly affect your experience.
By partnering with a nonprofit investment advisor like Infinite Giving, you’ll receive a variety of additional perks that can help you manage your finances and earn more asset donations. These services include:
Just take a look at the all-inclusive, branded donation page you’ll receive by partnering with Infinite Giving:
With these financial tools and fiduciary guidance, you can empower your supporters to donate larger amounts in more tax-efficient ways. You’ll also have nonprofit financial advisors by your side every step of the way as you move toward long-term financial sustainability.
Now that you understand the basics of nonprofit brokerage accounts, you’re one step closer to improving your organization’s cash management. These accounts can open the door to exciting opportunities, like investing and accepting non-cash contributions, which help to further support your mission.
For more insight into everything you can achieve with a nonprofit brokerage account, check out the following resources:
Karen Houghton is the CEO and co-founder of Infinite Giving, a Registered Investment Advisor that helps nonprofits build financial sustainability. With a background in both nonprofit leadership and venture capital, Karen brings a rare blend of heart and strategy to financial stewardship. She is passionate about democratizing access to wealth-building tools and guiding mission-driven organizations toward long-term financial health.
As a trusted advisor and advocate, Karen is reshaping how nonprofits think about money as a powerful resource for growing impact. Her work empowers tax-exempt entities to grow their assets, weather uncertainty, and fund their futures.
Infinite Giving Advisory Services, Inc. is an SEC-registered investment adviser. Advisory services are only offered to clients or prospective clients where Infinite Giving Advisory Services, Inc. and its representatives are properly licensed or exempt from licensure. This content is solely for informational purposes. Past performance is no guarantee of future returns.
Investors’ experiences may vary from the content. Nothing in this presentation constitutes investment advice, performance data, or any recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Infinite Giving manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary.
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