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Charles Schwab Cons and Pros (2022)

Charles Schwab pros and cons, benefits and downsides, perks offered. Is Charles Schwab good or bad? Charles Schwab individual/joint account advantages and disadvantages for 2022.

Charles Schwab Pros

Great Customer Service: There's no question about it, Charles Schwab offers top-notch customer service. The reviews on their website show a long list of happy customers. Searches on Google will also show similar reviews. Customer service agents are available 24/7 to offer help, advice, information about an account, or to place a trade on a customer's behalf.

Reasonable Investment Minimum: At $1,000, the minimum amount to open a Schwab brokerage account is very reasonable. Fidelity requires $2,500 minimums--more than double Schwab's minimum. This $1,000 minimum can be waived by setting up an automatic $100 monthly transfer or by opening a Schwab Bank High Yield Investor Checking Account.

No Account Maintenance Fee: With no fee for maintaining the account, Schwab brokerage customers have more money to put toward their investments, not fees. Though it's worth noting that there is a $50 ACAT fee for moving an account to a different firm, but this fee is normal across most brokerage companies.

Professional Trading Platforms: All Schwab brokerage customers with account balance of $1,000 or more have access to two professional trading platforms: StreetSmart Edge and Trade Source. Both are free and have no trade minimums.

No Commissions On Stocks And ETFs: Schwab's $0 stock and ETF commission is hard to beat but it is matched by many brokerage companies such as Ally Invest and Webull. This is something to consider when doing lots of stock or ETF trading.

World Class Research: Schwab provides customers with expert research at no additional cost. Their proprietary research provides stock ratings and fundamental details, with custom filter settings that enable customers to identify investment opportunities that meet their selected criteria. Schwab customers can also see Buy-Hold-Sell opinions as well as access analysis and commentary information from a variety of financial firms.

Schwab Mobile App: The Schwab mobile app provides instant access to brokerage and bank account information, as well as the ability to enter trades, deposit checks, and contact customer service. This app is free to download, easy to use, and available on most devices.

Schwab Intelligent Portfolios: New to the Charles Schwab pros list, Intelligent Portfolios was created to compete with the new trend of robo advisor services like Betterment and M1 Finance (FREE). These services build, monitor, and rebalance portfolios according to a set risk tolerance and other factors specified by the customer. The benefit of Schwab's Intelligent Portfolio's is that--on top of the standard robo advisor features--there is no fee for the service. The one caveat is that Schwab promotes its own ETFs as choices in the portfolio.

Charles Schwab Cons

Commissions On Mutual Funds Are Steep: The most important among Charles Schwab cons are some of the highest in the industry commissions to buy mutual funds that are not in no-fee program (most popular Vanguard and Fidelity funds will be there). Schwab is charging $49.95 to purchase these funds. Selling is free. To compare: Ally Invest is charging just $9.95 to buy or sell these mutual funds and Firstrade is charging nothing.

High Margin Rates: Another important Charles Schwab con is high interest rates on borrowed cash.

Promotion Only For Rich: One major Charles Schwab disadvantage is that their promotion offer benefits only investors depositing $100,000 or more into their account. Many other brokerage firms offer much more reachable new client promotions.

Physical Location Not Guaranteed: Charles Schwab has over 300 locations across the U.S., but that does not guarantee that all customers will find a nearby Schwab branch location. Though it is not necessary to visit a physical location, customers have the ability to find one if they so choose.

Is Charles Schwab good or bad?

Charles Schwab Review

Charles Schwab's brokerage account comes with exceptional customer service, great features, and world class research. While some mutual funds commission fees are higher than some other firm's brokerage accounts, they are still reasonably priced when considered with the account benefits. The fact that there is not a huge physical presence of brick-and-mortar locations is not a concern for most customers, especially since Schwab's 24/7 support is reliable and easy to navigate.

Read full Charles Schwab Review

Charles Schwab Overview

Among brokerages, Charles Schwab is a great solution for entry-level and experienced investors alike. Schwab has taken steps in recent years to be more competitive with rivals such as E*Trade in terms of fees and commissions, and its wide array of research options and proprietary tools make it a clear-cut addition to any investor's portfolio.

Solutions and Pricing

Charles Schwab's pricing and commission structure make it very attractive for investors. The service requires a $1,000 minimum investment to open an account, which is moderately higher than other competitors such as E*Trade (which has a $500 minimum), but this minimum can be waived by setting up a $100 automatic monthly deposit. Most importantly, after that initial deposit, Schwab does not levy account maintenance fees, enforce minimum balances, or charge for account inactivity.

Charles Schwab annual fee on all of its accounts is $0. Some brokers, such as Vanguard and Wellstrade, do charge an annual account fee in some cases.

Recently Schwab engaged in an effort to undercut its rival brokerages, including E*Trade and Fidelity, on commission costs. Currently charging $0 per trade on its platform, Schwab is one of the least expensive options on the market by commission, and has more value at that price point for investors. For investors who would prefer a human-operated trade, a Schwab consultant can enter in a broker-assisted trade for a $25 surcharge. The platform offers access to all ETFs commission-free and more than 3,000 commission-free mutual funds for those investors who are prize paying as little in fees and commissions as possible.

Charles Schwab is known for its traditional financial services, including brokerage accounts and IRAs, but it also offers more specialized solutions. Schwab Intelligent Portfolios, for example, is an automated investing account, for the benefit of more hands-off investors, that mimics the investment strategies employed by robo-advisors such as Betterment and Wealthfront. Its Global Account provides access to foreign markets that are otherwise inaccessible through typical brokerages. And for customers who need a banking solution, Schwab offers a savings account that connects directly to any brokerage or IRA account.

Platform Basics

For any given security, the platform gives customers a significant amount of information to help identify their next investment. The platform is an easy to use research interface, allowing customers to read up on markets and industries as well as specific securities, including stocks, mutual funds, and ETFs. It includes up-to-the-minute news from wire services such as AP and Reuters, Charles Schwab's proprietary advice and research in the form of its Equity Ratings Reports, as well as regular industry-level and security-specific reports from several 3rd-party financial analysts, including Morningstar, Ned Davis, Credit Suisse, Argus, S&P, and Market Edge.

To make it easier for customers to find the right security for them, Schwab built a stock screener tool. This tool, including selections that are either pre-defined by Schwab or custom-built, allows customers to use dozens of data points to identify the securities that fit their criteria—including basic attributes such as industry and market capitalization, more advanced attributes such as P/E ratio and estimated EPS growth, and technical attributes such as Parabolic SAR and Bollinger Bands. In the landing page for each security, Schwab provides the latest news, historical charts, analyst ratings and forecasts, a full array of public earnings and statements, industry and peer comparison charts, and options/futures data.

Charles Schwab Cons

Once a customer has established a portfolio, Schwab makes it easy to optimize and track returns over time. Its capabilities include simple screens that customers can use to view realized and unrealized gains in their portfolio as well as automated portfolio checkups that compares the makeup of a customer's portfolio to both their stated risk tolerance as well as the general trends in the market. Schwab also provides a quarterly portfolio profile—a custom-tailored report that analyzes a customers' investments across all Schwab accounts for asset class diversification, equity concentration, and more comparison points.

Charles Schwab Cons And Pros Summary

A feature that was previously restricted to active traders, but now available to all customers, StreetSmart stands out as a customizable platform that lets more experienced traders create the interface and notification workflows that work best for them. Users receive access to a live feed of Schwab's data, including streaming quotes, watch lists, and news, as well as advanced custom charting tools that are not available in the standard interface. A premium platform, StreetSmart Edge, is available as well to provide even more opportunities for customization. Unfortunately, the StreetSmart and StreetSmart Edge desktop apps are both restricted to Windows systems using Internet Explorer, though an online solution is available for Mac users.

Schwab also offers a wide range of guides to help investors plan for the future. Compared to rivals such as Webull, which strictly offers guidance on securities, Schwab also provides advice for major life events such as college, retirement, or even just Tax Day. This takes the form of articles and webinars on its website, video guides to walk people through trading concepts, a 24/7 customer service center, as well as Charles Schwab's 300+ branches around the United States. Unlike digital-only brokerages, any customer can set up an in-person meeting at one of Schwab's branches for more dedicated advice from a financial expert, which can be very useful for more advanced investment challenges.

About the Author
Chad Morris is a financial writer with more than 20 years experience as both an English teacher and an avid trader. When he isn’t writing expert content for, Chad can usually be found managing his portfolio or building a new home computer.