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Charles Schwab Charles Schwab tops our list of the best online brokerages, offering something for everyone. Whether it be commission-free trading and fractional shares, Schwab has all the options you might want at industry-leading prices.
Business Insider's personal finance team compared Charles Schwab Charles Schwab to the best stock trading apps and found it to be an industry leader.
Introduction to Charles Schwab
Charles Schwab Charles Schwab is one of the few companies that tries to offer both "convenience" and "low cost" in one brokerage package, with more than 400 physical branches scattered throughout the US.
Charles Schwab brokerage accounts start at $0 and have notoriously low fees compared to other brokerages.
However, there are high minimums for certain account levels, such as Schwab Intelligent Portfolios ($5,000 minimum) and Schwab Intelligent Portfolios Premium ($25,000).
Charles Schwab is a great brokerage option for most investors as one of the most recognizable brokers in the US.
It's a beginner-friendly trading platform offering many investable securities, account options, and resources. Schwab Asset Manager is the third-largest index mutual fund provider with over 30 years of indexing experience.
You can now access spot Bitcoin ETFs on Charles Schwab in addition to Schwab Crypto Thematic ETF and the Additional ETFs & Mutual Funds portfolios that invest in equities and futures contracts related to cryptocurrencies. Schwab doesn't offer direct crypto investing.
How Charles Schwab Works
Schwab offers individual and joint brokerage account options for depositing funds and investing in stocks, bonds, mutual funds, ETFs, and other investment opportunities. Its offerings are some of the most affordable in the industry.
Over 4,000 of Schwab's mutual funds have minimum investment requirements of only $100 or less. Many of those funds, including all 200+ of its index funds, also come with no transaction fees or loads.
However, Schwab also sells transaction-fee funds; if you decide to purchase one, it could cost you up to $49.95 per buy, which is pretty high.
Charles Schwab's customer service and support are available 24/7, with access to online tools, investment research, and Schwab's mobile app. Schwab's trading platform, StreetSmart Edge, also offers a wealth of stock data, news, charting tools, screeners, watch lists, and conditional order options to meet traders' needs.
Individual brokerage accounts get you access to more features, including in-depth analysis, portfolio performance tracker, Morningstar research, and timely market commentary from Schwab experts. Users may also utilize the thinkorswim suite.
Schwab Retirement Accounts
Charles Schwab offers many types of retirement savings accounts, including:
- Traditional IRA
- Roth IRA
- Rollover IRA
- Custodial IRA
- Inherited IRA
You can also open a Personal Choice Retirement Account (PCRA), a self-directed, employer-sponsored retirement plan that lets you invest in a larger range of investment options.
This includes thousands of different mutual funds and ETFs. Unlike traditional retirement accounts, a PCRA gets you more account flexibility and personal involvement.
A PCRA is only recommended for folks who want to put a lot of time and effort into making their own investment decisions and are knowledgeable in investing/saving plans.
Also, Schwab doesn't allow its advisors to be appointed to PCRA accounts. But the site also states that you may be able to appoint a non-Schwab-issued independent advisor.
Schwab Intelligent Portfolios
Schwab Intelligent Portfolios account is the best robo-advisor for account flexibility. Invest in a custom blend of diverse and low-cost Schwab ETFs aligned with your target asset allocation and risk tolerance.
You'll also get access to common robo-advisor features like automatic portfolio rebalancing and tax-loss harvesting. A risk tolerance and goal planning questionnaire determines how your portfolio is set up and how to invest your funds.
The premium version of this account gets you unlimited access to a certified financial planner (CFP) for one-on-one advice and guidance. It also offers interactive online planning tools like the "what-if" Play Zone stress test and a customized goal roadmap.
529 Savings Plans
Schwab's 529 Education Savings plan invests in a diverse portfolio of mutual funds from multiple fund families so you (or a dependent) can save for future higher education costs. You can use 529 plan funds for tuition (including K-12 costs), school supplies, apprenticeships, trade schools, room and board costs, and more.
The best 529 plans account has multiple risk tolerance and investment strategy portfolio options, including actively managed or low-cost index fund portfolios. You can also open an additional education saving account to complement your 529 plan account. However, contributions to this account are not taxable.
Schwab Custodial Accounts
A Schwab One Custodial Account allows a parent/guardian to open a savings account for a child/dependent's long-term growth potential. Funds from a custodial account can be saved and invested for future retirement savings, college tuition costs, or down payments.
The beneficiary can access the account when they reach the age of 18 or 21, depending on the state). There are no contribution limits, but you won't get the same tax advantages that 529 plan accounts have.
Instead, only the first $2,500 of the beneficiary's unearned income is tax-free (this only applies to beneficiaries younger than 19 or full-time college students under 25).
Schwab Small Business Retirement Accounts
- Individual 401(k) plans
- Business 401(k) Plan
- SEP IRA
- SIMPLE IRA
- Personal Defined Benefit Plan
- Company Retirement Account (CRA)
Schwab's Personal Defined Benefit plan is for self-employed individuals and small business owners aged 50 or older. Investors can make large contributions for short-term, high-risk investment strategies (at least five years).
Schwab's Company Retirement Account (CRA), a "pension trust," is a brokerage account that holds assets from a customized retirement plan. You should only open this account if you're a plan administrator or business owner already with a retirement plan. It allows you to invest in various assets and access third-party research, tools, and expert insight.
Schwab Managed Portfolios
Charles Schwab-managed portfolio services get you access to actively managed, diversified portfolios of mutual funds or ETFs. There's a $25,000 required minimum investment for each portfolio, but the specifics of what's included differ as follows:
- A Schwab Managed Portfolio — Mutual Funds: A professional portfolio management team monitors and rebalances your mutual fund portfolio on an ongoing and annual basis. Choose from 24 taxable mutual fund portfolios diversified to your individual risk tolerance. The higher your account balance, the lower the annual management fee (ranging from 0.20% and 0.90%).
- A Schwab Managed Portfolio — ETFs: Access ongoing professional management by Schwab financial experts to monitor and rebalance low-cost, diversified ETFs. Choose from 12 ETF model portfolios for diverse market exposure to asset classes like commodities, private equity, and real estate. Depending on your total account balance, management fees range from 0.50% to 0.90%.
Schwab Socially Responsible Investing
Schwab Charitable is a donor-advised fund account that allows you to structure your charitable contributions with tax advantages. You can open a free core or professionally managed account. With this account, you can grow investments tax-free, itemize your deductions, and possibly eliminate capital gains tax on charitable contributions on non-cash assets.
Contribute cash, publicity traded securities, stocks, bonds, mutual funds, real estate, private equity, and more. According to its website, Schwab Charitable Accounts supported over 127,000 Charitable organizations in 2023.
Otherwise, additional ESG investment options include over 500 mutual funds and 200 ETFs. One option is Schwab Ariel ESG ETF, a long-term fund that keeps certain information secret to prevent other traders from copying or predicting the allocation. This strategy may help the ETF's performance but could also hurt it.
Schwab Trust and Estate Accounts
Schwab One Trust Account is an easy way to manage and protect your trust's assets for estates of any size. This account comes with all the benefits that the Schwab One brokerage account offers, as well as accessible asset management, distribution of assets after death, 24/7 customer service and support, and more.
If you're an executor or court-appointed estate administrator, you can open a Schwab One Estate Account to manage and consolidate assets, access cash, pay taxes, and cover expenses.
This account also has the same perks as the Schwab One brokerage account. You can quickly distribute assets to beneficiaries, transfer titles to heirs, and get an accurate value on your estate for the IRS.
Charles Schwab Account Tools and Wealth Management
Charles Schwab offers investment research tools such as its Portfolio Checkup tool, Schwab Stock Slices, and mobile app.
Wealth Management Tools
Charles Schwab offers many options for investment advice and management. First, if you want to analyze a DIY portfolio, you can use Schwab's Portfolio Checkup tool anytime. It will evaluate your portfolio's performance based on your target asset allocation and recommend necessary adjustments.
Finally, if you have complicated wealth management needs, Schwab can connect you with a local advisor near you via its Schwab Advisor Network. With Schwab's Private Client service, you can get a dedicated team to build and maintain your portfolio.
You'll need at least $1 million to be eligible for Schwab Private Client, and the advisory fees start at 0.80% with a $500,000 enrollment minimum.
Fractional Share Investing
Schwab Stock Slices allow users to buy fractional shares of individual stocks for as little as $5. Stock Slices make expensive stocks accessible to investors with smaller amounts of money.
For example, let's say you wanted to invest in Amazon, but one share costs hundreds of dollars when considering buying. You may not have that much to invest right now. Even if you had barely enough to invest, putting most of your investment pot into just one company is risky.
But with Schwab Stock Slices, you can invest $5, $10, $100, or whatever other amount you choose in any stocks that are part of the S&P 500. And you can buy up to 10 slices at one time.
For example, you could invest $500 in four companies ($125 a piece). Or choose to separate that $500 into 10 different companies at $50 a piece, even though buying one share of each of those 10 stocks would cost you far more.
Schwab Stock Slices essentially give investors the power to build their own mutual fund out of blue-chip stocks with strong track records and dividends.
Capable Mobile Apps
Charles Schwab's mobile app experience is well-designed and feature-rich. Not only can you use the app to check your account balances quickly, but you can also use it to plan and execute trades.
The main app is fine for doing lower-level research on individual stocks and basic trading. However, if you're looking for more in-depth research and charting tools, you'll probably want to download Schwab's StreetSmart app.
The main Schwab mobile app and StreetSmart are available on Google Play and Apple devices. You can log in with your Schwab username and password. Or, for extra security and convenience, you can log in using your fingerprint or Face ID.
Charles Schwab Fees
Most Charles Schwab brokerage account options have $0 opening and maintenance fees and $0 account minimums. However, a few portfolio options and account types charge higher minimums and fees.
| Account option | Account minimum | Fees |
| Brokerage accounts | $0 | Maintenance fee: NoneCommissions: $0 per online listed equity trade, and online Schwab ETFs |
| Retirement accounts | $0 | Maintenance fees: NoneService fees: None |
| Personal Choice Retirement Account | $0 | Equity commissions: $0 online tradesBroker-assisted trades: $25Maintenance fee: May be charged |
| Schwab Intelligent Portfolios | $5,000 | Advisory fees: NoneCommission fees: NoneTax-loss harvesting: Must have an account balance of at least $50,000 |
| Schwab Intelligent Portfolio Premium | $25,000 | One-time planning fee: $300Advisory fee: $30/monthlyTax-loss harvesting: Must have an account balance of at least $50,000 |
| Schwab 529 Education Savings Plan | $0 | Maintenance fees: NoneBrokerage commissions: NoneService fee: NonePortfolio fee: range from 0.20% to 0.86% |
| Education Savings Account | $0 | Maintenance fees: NoneService fees: NoneCommissions: $0 per online listed equity trade. $0 per online trade ETF, stocks options, and mutual funds |
| Schwab One Custodial Account | $0 | Maintenance service fee: $0Commissions: $0 online listed stock and ETFsOptions trades: $0.65 per contractTraders through a broker: $25Automated phone trades: $5 |
| Individual 401(k) Plan, SEP IRA, SIMPLE IRA | $0 | Monthly service fee: NoneMaintenance fee: NoneCommissions: $0 per online listed equity trade, and online Schwab ETFs |
| Schwab Personal Defined Benefit Plan | Start-up fees: starting at $2,250 | Annual service fees: $1,750Commissions: $0 per online listed equity trade, and online Schwab ETFs |
| Schwab Charitable | $0 for core accounts$240,000 for professionally managed accounts | Minimum grant (both account types): $50Annualized Administrative Fees: Varies by average daily value (ranges from 0.10% of assets to 0.60%) |
| Schwab One Trust Account | $0 | Monthly service fees: $0Commissions: $0 per online listed equity trade, and online Schwab ETFs |
| Schwab One Estate Account | $0 | Monthly service fees: $0Commissions: $0 per online listed equity trade, and online Schwab ETFs |
Other investment strategies, advisory options, and indexing minimums include:
- Schwab Wealth Advisory: $500,000 enrollment minimum
- Schwab Advisor Network: $500,000 investment minimum
- Managed Account Select Equities strategies: $100,000 minimum
- Managed Account Select Fixed Income Strategies: $250,000 minimum
- Schroeder Strategies: $250,000 investment minimum
- Windhaven Strategies: $100,000 investment minimum
- ThomasPartners Strategies: $100,000 investment minimum
- Schwab Personalized Indexing: $100,000 investment minimum
Charles Schwab's large selection of account options and investment choices results in an extensive range of fees, depending on how you choose to invest.
Pros and Cons of Charles Schwab
Charles Schwab Pros
- No minimum to open an account
- Automated account options
- More than 8,000 no-transaction-fee mutual funds and even more low-cost index funds
- Access to sophisticated trading tools, 24/7 customer service, and research
- Multiple investment options (stocks, bonds, ETFs, mutual funds, options, futures)
Charles Schwab Cons
- High account minimum for Schwab Intelligent Portfolios and Schwab Intelligent Portfolios Premium
- Can't trade individual cryptocurrencies
Charles Schwab Trustworthiness
Charles Schwab has received an A+ rating with the Better Business Bureau. The BBB uses a grade range of A+ to F when assigning its ratings, and its ratings reflect its assessment of how well a company interacts with its customers.
BBB ratings don't guarantee that a company will perform well or be reliable. You may want to ask friends and family who have used Charles Schwab about their experiences or read online customer reviews.
In June 2022, Charles Schwab settled a lawsuit with the SEC for charges accusing the business of hiding robo-advisor fees from its users. Charles Schwab neither admitted nor denied these claims, but agreed to pay a $187 million settlement.
Charles Schwab vs. Other Stock Trading Apps
Here's how Charles Schwab compares.
Charles Schwab vs. Fidelity
Charles Schwab and Fidelity Investments caters to all types of investors and traders. Both platforms offer self-directed accounts, retirement accounts, automated investing accounts, and more. However, they diverge regarding investment products, fees, and educational resources.
While Fidelity's basic automated investing account, Fidelity Go, has a $0 minimum requirement, you'll need at least $5,000 to set up Schwab's equivalent account (Schwab Intelligent Portfolios Premium). However, Schwab Intelligent Portfolios makes up for its higher minimum by charging $0 in advisory fees. You may pay up to 0.35% for Fidelity Go.
Fidelity offers bitcoin and ether for trading and custody services, although it is significantly more limited in its crypto selection than other investment platforms. However, Fidelity is a better option for crypto trading than Charles Schwab as it doesn't offer direct crypto trading.
Charles Schwab vs. Vanguard
Vanguard is another strong online broker-firm offering several account types — self-directed brokerage accounts, IRAs, automated investing accounts, and custodial accounts — at both companies.
But Schwab has a wider range of offerings and platforms (e.g., its advanced StreetSmart Edge trading platform) for all types of traders. Plus, its advisor-managed account, Schwab Intelligent Portfolios Premium, has a lower account minimum requirement ($25,000) than Vanguard's equivalent (Vanguard Personal Advisor), which requires a minimum of $500,000.
In addition, options traders will pay more for contracts at Vanguard. Schwab has a $0.65 contract fee, while Vanguard charges $1.
Methodology: How We Reviewed Charles Schwab
When reviewing brokerage accounts, we use Business Insider's rating methodology for rating investment products to compare and examine pricing, account types, investment availability, platforms, and overall customer experience. Top brokerage firms offer different platforms for different investment needs. Platforms are given a rating between 0 and 5.
Some brokerage accounts are best for beginners, and others are ideal for more advanced investors. The Charles Schwab brokerage account was evaluated based on its performance in each category.
Business Insider's Overall Charles Schwab Rating
| Feature | Rating (out of 5) |
| Fees | 5.00 |
| Investment selection | 4.75 |
| Access | 4.65 |
| Ethics | 5.00 |
| Customer service | 5.00 |
| Overall score | 4.88 |
Charles Schwab FAQs
Charles Schwab is a popular online brokerage offering investing and retirement planning services for all types of investors. It's known for its quality customer service, low fees, and extensive selection of securities.
Charles Schwab provides a transparent and competitive fee structure. Depending on the kind of account and the assets in your portfolio, you may incur certain AUM and trading fees. Schwab is an attractive option for fee-conscious investors since it does not charge account maintenance or inactivity fees.
Yes, beginners can use Charles Schwab effectively. Schwab offers educational tools and resources, such as expert-managed accounts and an automated account option. Charles Schwab's educational resources for beginners include investing insights, market commentary, retirement savings blog posts, and podcasts.
Charles Schwab's investment research and market reports come from third-party firms like Argus and Morningstar, so experienced investors can better monitor the markets. You can also review heat maps, Schwab insights, and market commentary.
