Charles Schwab Review 2024: Is It Right For You?

Where Charles Schwab shines

Well-rounded offering: Charles Schwab caters to investors of all stripes: Beginner investors will appreciate the company's $0 account minimum, while the $0 commission for stock and exchange-traded funds will appeal to active traders.

Extensive research: Schwab receives high marks for its research offerings, which include Schwab’s own equity ratings, in addition to analyses and commentary from the industry’s top research firms.

Fund selection: Schwab has a large selection of funds with low expense ratios, as well as many funds that charge no transaction fees.

Where Charles Schwab falls short

What type of investor should choose Charles Schwab?

Traders who want it all: Whether you want niche securities or high-level research, Schwab's got it.

Bargain hunters: Schwab has very low fees, and an expansive selection of low-fee mutual funds, so if you're trying to save some money it may be a good fit.

Advanced traders: If you're an advanced trader looking for an advanced platform, look no further than Schwab's thinkorswim. This platform has everything advanced traders need with lots of bells and whistles to make the experience even better.

What the Nerds think 🤓

Charles Schwab at a glance

How to sign up for a Charles Schwab account

To open a brokerage account with Charles Schwab you can do so online, over the phone or at a local branch. You'll need to choose the type of account you want to open — for example, a traditional brokerage account or an IRA — and if you want it to be an individual or joint account. You'll need your Social Security number, your driver's license, employment information and statement information for any assets or cash you want to transfer. You'll also need to verify your identity and connect any bank accounts.

What to know about Charles Schwab's fees

Schwab has no account minimum and no commissions for stock, options, and ETF trades. While Schwab doesn’t charge any per-trade commissions for options, it does charge $0.65 per contract. This is a typical charge, and is on par with other brokers that charge an options contract fee — but it's worth nothing that several have recently eliminated that charge. Schwab does charge $6.95 per OTC trade. Because of this charge, investors wanting to trade penny stocks may want to look elsewhere.

Schwab has some of the lowest account fees around — if you’ll have to pay them at all. Schwab doesn’t have any annual or inactivity fee. The fee to transfer all of your assets from your account is $50, though there's no fee for a partial transfer.

Charles Schwab's trading platforms and apps

Schwab offers five trading platforms: Schwab.com, Schwab Mobile, and the thinkorswim platform, which is available as a downloadable desktop platform, online and as a mobile app. Our rating for Schwab's mobile app is based on Schwab Mobile, not the thinkorswim app.

Schwab.com's platform works for everyday investing and trading, though both the web and mobile app experiences are a little clunky. They certainly don't have the smooth user interface of more mobile-first brokers like Robinhood. Schwab's online experience has some features, such as alerts and screening, but it's limited. The mobile app is even more limited.

The platform more advanced traders will love is thinkorswim. The most capable is the downloadable desktop experience, though the web experience offers similar features. Both the desktop and web versions of thinkorswim have customizable workspaces, Level II data, conditional orders, paper trading, live financial news and advanced charting. The thinkorswim app isn't far behind: The only thing it lacks is screening within the app. Schwab.com's website and app don't offer most of those features.

Thinkorswim is one of the highest-tier trading platforms out there. It offers deep customization with its charts and interfaces, screeners with custom attributes, Trade Flash (a feature that shows third-party analyst up/downgrades, trade imbalances, trading floor events and more), "what-if" scenario analysis on real and hypothetical trades and technical analysis from more than 400 studies.

One area where Schwab.com stands out over thinkorswim is with its available products. On Schwab.com's online experience and its app you can trade stocks, ETFs, options, complex options, mutual funds and fixed income. On thinkorswim you don't get access to mutual funds or fixed income, though you can trade futures and forex. That said, most advanced traders probably aren't too worried about mutual funds or bonds.

Charles Schwab's investment selection

Charles Schwab has a large selection of tradable securities, including stocks, bonds mutual funds, ETFs, index funds, options, forex and futures.

Schwab delivers access to more than 8,000 no-transaction fee mutual funds, and within its own proprietary lineup of index funds and ETFs, Schwab now offers some of the lowest expense ratios available. All told, more than 2,400 funds on Schwab's platform have expense ratios of 0.50% or below and more than 500 funds have minimum investment requirements of $100 or less.

With so many available funds, it can be hard to choose. Schwab's ETF Select List helps narrow the choices, featuring picks for the best fund in selected categories. You can sort the list by feature, including expense ratio, Morningstar category and benchmark index. There's also the Personalized Portfolio Builder tool, designed to help you create a diversified portfolio based on your financial goals, risk tolerance and time horizon.

When it comes to bonds, Schwab has a comprehensive selection. Choices include new-issue municipal and corporate bonds, plus government options such as Treasurys.

Schwab Stock Slices offer access to fractional shares, so investors can buy a small slice of a stock rather than paying the full share price. For example, if a stock costs $100 a share, and you buy a $10 slice, you’d own 10% of a share. Single slices are available for as little as $5, and investors can buy up to 10 slices at a time. However, this feature is only available for stocks of S&P 500 companies. Similar brokers that offer fractional trading don't have such restrictions on their fractional share offerings.

Charles Schwab clients aren't currently able to trade cryptocurrencies directly. However, the broker does offer access to spot Bitcoin and Ethereum ETFs.

Other key Charles Schwab features

Research and data

Schwab provides its own equity ratings, along with reports from several top-tier providers. In addition to real-time news and earnings reports, the broker offers a variety of research reports and market commentary authored by in-house experts, as well as a quarterly magazine free of charge.

Schwab’s investment screeners are easy to use and let you save your screens. Select Lists, like the previously mentioned one for ETFs, are compiled by the company’s experts and released quarterly to give you a pre-screened selection of mutual funds and ETFs. The funds on the list are divided by category, so you can easily see the company’s picks for, say, large-cap stock mutual funds.

The company is also integrated with Google Assistant — you can ask Google for stock quotes, general market updates and more — and has an Amazon Alexa skill that provides similar information, including the ability to create and get updates on a watch list.

Customer support

Customers have plenty of ways to get in touch. Phone, email and online chat are all available 24/7. If you prefer to speak to someone in person, there are more than 360 Charles Schwab branches around the country, with some even open on Saturdays.

Execution quality

Schwab does receive payment from market makers for routing orders (called payment for order flow), although the company says that does not affect the value consumers get from using its brokerage services. It is also very transparent and clearly explains its order routing process, overall price improvement statistics and execution quality on its website. Schwab says its execution quality is 97.50%.

IRA account

Charles Schwab is a leading broker in the retirement account space, with traditional and Roth IRAs as well as self-employed retirement accounts. IRAs are retirement savings accounts that offer significant tax savings, such as a tax deduction on contributions or tax-free growth of your investments. You can have an IRA in addition to a standard brokerage account.

For traditional and Roth IRAs, Charles Schwab does not charge fees for opening or closing an account, maintenance or inactivity. Schwab also does not charge any annual fees.

Good to know about Charles Schwab

Low interest rate on uninvested cash

Schwab pays about 0.45% on uninvested cash in your brokerage account (this rate can vary based on market conditions). Schwab does offer clients options for getting a higher rate for cash products, but you'll need to select and opt into them.

Is Charles Schwab safe?

All investing comes with the risk of loss, but Charles Schwab is covered by insurance and is registered with all the appropriate governing bodies.

Is an investment at Charles Schwab FDIC insured?

Schwab has FDIC insurance to protect cash deposits in checking and savings accounts for up to $250,000. Charles Schwab is also covered by SIPC insurance, which protects brokerage accounts up to $500,000. SIPC insurance don't apply to investment losses or price fluctuations. Charles Schwab is also regulated by the Securities and Exchange Commission to ensure compliance with securities regulations, and by FINRA, which regulates broker-dealers.

Is Charles Schwab right for you?