Charles Schwab: A Comprehensive Guide for Investors

Charles Schwab is one of the largest financial institutions in the United States, offering a wide range of services to its clients, including brokerage services, mutual funds, exchange-traded funds (ETFs), advice solutions, banking, and trust.

Schwab is a good choice for beginners to experienced traders. The company offers a variety of educational resources to help you learn about the stock market and how to invest, as well as a variety of investment products and services.

What Services Does Schwab Offer?

Schwab’s services are available to both individual and institutional investors. Schwab also offers a variety of services to registered investment advisors (RIAs) and financial institutions. The company has the following main products and services:

  • Schwab Brokerage: Schwab Brokerage is a platform that allows you to trade stocks, ETFs, options, futures, and mutual funds). Schwab offers a variety of trading tools and resources, including real-time quotes, charting, and research.
  • Schwab Intelligent Portfolios: Schwab Intelligent Portfolios is a robo-advisor platform that invests your money in a diversified portfolio of ETFs based on your risk tolerance and investment goals.
  • Schwab Advisor Services: Schwab Advisor Services is a network of independent financial advisors who can help you create and manage a financial plan.
  • Schwab Retirement Plan Services: Schwab Retirement Plan Services offers a variety of retirement plan services for employers and employees, including 401(k) plans, 403(b) plans, and IRAs.
  • Schwab Bank: Schwab Bank offers a variety of banking services, including checking and savings accounts, CDs, money market accounts, and loans. Schwab Bank accounts are FDIC-insured, so your money is protected up to $250,000 per depositor, per account ownership type, in the event of a bank failure.
  • Schwab Trust: In this, the company offers trust custody services, personal trust reporting, and administrative trustee services.
  • Educational services: Schwab offers a variety of educational resources to help clients learn about investing and retirement planning. Schwab also offers a variety of webinars and workshops on a variety of financial topics.

What is the Pricing of Schwab?

As described above, Schwab is one of the largest financial companies in the US whose size enables it to make money through commissions it charges its investors, asset management and administrative fees, and interest from the customer deposits. Here’s a list of common Charles Schwab fees:

Trading TypeSchwab Fees and Charges
Stock and ETF tradesCommission-free on major U.S. exchanges.
Options trades$0.65 per contract fee.
Mutual fund tradesCommission-free on thousands; possible extra fees.
Broker-assisted trades$25 service charge.
Futures trades$2.25 per contract fee.
Account maintenance feesNo basic account fees; others vary.
Activity fees$5/month for < $10,000, < 30 trades/quarter.
Inactivity fees$25/quarter for > $10,000, no trades in 12 months.

After researching customer reviews and a wide range of other sources, we have come up with the following tips for minimizing your Schwab fees:

One of the best ways to minimize your Schwab fees is to take advantage of their commission-free trading options. Schwab offers commission-free trading on stocks, ETFs, and thousands of mutual funds. If you’re trading these types of investments, be sure to use Schwab’s commission-free trading options to save money.

Another way to minimize your Schwab fees is to avoid broker-assisted trades. Schwab charges a $25 service charge for broker-assisted trades. If you can, place your trades online or through Schwab’s automated phone system to avoid this fee.

Keeping your account balance above $10,000 is another way to minimize your Schwab fees. Schwab charges a $5 per month fee for accounts that have less than $10,000 in assets and make less than 30 trades per quarter. If you can, keep your account balance above $10,000 to avoid this fee.

Finally, making at least one trade per year can help you minimize your Schwab fees. Schwab charges a $25 per quarter fee for accounts that have more than $10,000 in assets and have not made any trades in the past 12 months. If you can, make at least one trade per year to avoid this fee.


What is Schwab Intelligent Portfolios?

Schwab Intelligent Portfolios is a robo-advisor product that was formed in 2017. The product was launched as part of the company’s reaction to the emergence of other robo-advisor companies like Betterment and Wealthfront. These companies use algorithms to buy and sell investments. To use the Schwab Intelligent Portfolios, all you need to do is answer a few questions and then get a diversified portfolio based on your risk tolerance and timeline. After doing this, the algorithms will continue to monitor and rebalance the portfolio as shown below.

SchwabSource: Schwab

Charles Schwab Competitors

There are a number of Charles Schwab alternatives available, depending on your financial goals and preferences. Some of the most popular Schwab alternatives include:

In addition to traditional brokerage firms, several fintech companies offer micro-investing services. For example, Acorns, a micro-investing platform, helps you save and invest small amounts through automated “round-up” purchases. It rounds up everyday purchases to the nearest dollar and invests the spare change in a diversified ETF portfolio. Stash, an investment app, allows you to invest in fractional shares of stocks and ETFs with as little as $5.

Charles Schwab: A Good Choice for Investors of All Experience Levels

Schwab is a good brokerage in the US for investors of all experience levels, from beginners to experienced traders. If you are thinking of investing in the US financial market, Schwab is one of the companies you can use. The Intelligent Portfolios product is ideal for people who don’t have the experience in investing. It is also ideal for people who want to diversify their earnings. However, if you want to invest in stocks and ETFs, we recommend that you use a company like Robinhood that charges no commission.

Schwab’s fees are generally competitive, but there are some fees to be aware of, such as account maintenance fees, activity fees, and inactivity fees. You can minimize their fees by taking advantage of Schwab’s commission-free trading options and keeping your account balance above $10,000.

Crispus (BSc and MBA) is a finance professional with more than a decade experience as a financial analyst, writer, researcher, and trader. Crispus has written in-depth articles on leading platforms like CCN, Marketwatch, Investing Cube and Seeking Alpha. He also runs a forex education firm. Follow him on Twitter: @crispusnyaga and read more about us.