Access Wealth advisor Howard Milove, CPA/PFS, was recently featured in NJMoneyHelp, explaining how Securities Investor Protection Corporation (SIPC) coverage works and when it actually comes into play.
The article focuses on a specific, but important scenario: What happens if a brokerage firm goes out of business?
In the unlikely event that a firm fails financially and customer assets are missing, SIPC is designed to help recover securities and cash held in client accounts, up to certain limits. In many cases, accounts are transferred to another firm, helping investors regain access to their holdings.
Howard’s insights highlight that SIPC coverage is not something investors rely on during normal market conditions; it’s protection for a breakdown at the firm level, not for market fluctuations. It becomes relevant only when a brokerage firm is unable to meet its obligations, and client assets are at risk.
Just as important is understanding what SIPC does not cover. It does not protect against investment losses due to market performance, poor investment decisions, or changes in asset values. That distinction is critical, as it helps set realistic expectations around risk and protection.
Read the full article on NJMoneyHelp: What Protections Do My Assets Get with SIPC Coverage?
What This Means for You
While brokerage firm failures are rare, understanding how your assets are protected can provide added peace of mind. Knowing when protections like SIPC apply, and when they don’t, can help you better understand the role that risk plays in your investment strategy.
A well-structured plan doesn’t eliminate market risk, but it can help you navigate it with greater confidence.
Learn more about Howard and his approach to investment management.
