May 28, 2024: How the New T+1 Settlement Date Will Change Your Trading Day

Your next stock trade is about to get faster—but your payment schedule might get tighter. On May 28, 2024, the financial industry is switching from T+2 to T+1 settlement date rules, compressing the timeline for completing stock trades by exactly one business day. This regulatory shift from the SEC and FINRA sounds minor on paper, but it has concrete implications for how you move money and manage your portfolio.

What’s Actually Changing

Here’s the practical reality: when you buy or sell a security today, the transaction settles two business days later. Starting May 28, it settles the very next business day. Sold shares on Tuesday? Your proceeds arrive Wednesday instead of Thursday. Bought stocks on Wednesday? You need funds in your account by Thursday, not Friday.

The settlement date has been shortened once before. In 2017, the SEC compressed cycles from T+3 to T+2. This latest move reflects where trading infrastructure stands now—with digital platforms handling most transactions, holding securities in digital format, and electronic payment systems like ACH operating at scale. The physical delays that once justified longer cycles simply don’t exist anymore.

Who Feels the Impact Most

If you maintain a cash account and keep sufficient funds parked at your brokerage before trading, T+1 arrival will barely register. Most online brokers already require this.

But if you’re used to funding trades retroactively—sending an ACH transfer the day after your purchase confirmation arrives—you’re now on tighter timing. Simply initiating an ACH transaction the morning after trading won’t cut it. The actual funds must be posted to your brokerage’s bank account one day sooner, which means sending money on trade day or the day before your intended purchase.

For margin account holders, the picture is different. Initial Regulation T margin calls now operate on a T+3 timeline instead of T+4, adding one day of pressure. Maintenance margin requirements remain unchanged based on when the call was issued.

Securities Affected and Those Exempted

The new settlement date applies to most equity markets: stocks, bonds, municipal securities, ETFs, certain mutual funds, and exchange-traded limited partnerships. Options and government securities already operated on next-day settlement, so T+1 creates alignment across asset classes. The change simplifies the market’s backend architecture by standardizing when cash and securities must be delivered.

Investors holding physical, paper securities certificates face their own adjustment: your broker-dealer needs them earlier to deliver on time. However, paper certificates have become rare; nearly all holdings are electronic now, and your broker delivers on your behalf.

The Bottom Line

Reach out to your brokerage firm to confirm how T+1 settlement date changes affect your specific account setup. If you fund trades via bank transfers rather than maintaining cash reserves, building in an extra day of lead time for your next deposit is essential. This compressed timeline reflects technology’s advancement but demands tighter coordination on your end.

FINRA oversees brokerage firms and enforces compliance with securities regulations. The SEC sets the framework. Both agencies manage this shift to ensure markets operate efficiently while protecting investors.