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TD Ameritrade vs Acorns vs Fidelity in 2022


Overview


Acorns is a new type of brokerage firm trying to offer something fresh and different. But can it outperform household names like Fidelity and TD Ameritrade? Let our research provide the answer.


Cost


Broker Fees Stock/ETF
Commission
Mutual Fund
Commission
Options
Commission
Maintenance
Fee
Annual IRA
Fee
TD Ameritrade $0 $49.99 ($0 to sell) $0 $0
Fidelity $0 $49.95 $0.65 per contract $0 $0
Acorns na na na $3-$5 per month $3-$5 per month


Promotions


TD Ameritrade: $0 commissions + transfer fee reimbursement.

Acorns: Get $10 when you open an Acorns account with this referral link.

Fidelity Investments: Get $0 stock commissions.



Category 1: Method of Investing


Acorns customers invest by making purchases with debit and credit cards and rounding up to the nearest whole dollar. A purchase of $12.40, for example, would come in at $13, and $0.60 would be transferred to the buyer’s Acorns account. The firm only offers 12 ETFs, though. There are no other investments.


Acorns Investing Review


Fidelity and TD Ameritrade offer hundreds of exchange-traded funds plus mutual and closed-end funds. Also on tap are stocks, fixed-income products, and options. TD Ameritrade offers futures (including bitcoin futures) and forex; while Fidelity customers can trade physical gold and silver.

Neither Fidelity nor TD Ameritrade has a round-up service like Acorns. All three brokers permit recurring transfers from an external bank account.

Instead of paying money for a round-up service, it makes more sense to us to set up free recurring deposits. We like TD Ameritrade better in this category.


Category 2: Banking Features


Acorns clients can pay $3 per month for Acorns Spend, the broker’s checking account without checks. It does come with FDIC insurance and a debit card. We like ATM fee reimbursements, but not the lack of mobile check deposit.

Fidelity offers the Cash Management Account. This is a separate hybrid bank-investment account that comes with checks and a debit card. The brokerage house provides ATM fee rebates, mobile check deposit, and an FDIC sweep program that delivers five times the normal amount of insurance.

TD Ameritrade customers can add checks and a Visa debit card to an existing brokerage account. ATM fees are reimbursed nationwide. Mobile check deposit and regular FDIC insurance are standard features.

Fidelity looks best in class here.


Category 3: Trading Tech


Now we come to software, and all three brokers do well in the mobile category. The Acorns app is user-friendly but has no trading capability since there are no self-directed accounts. We did find several account management tools on the platform. A widget is able to link an external bank account (Acorns does charge a monthly fee), while another can be used to connect a debit or credit card for the round-up program. The Acorns website has the same features.

Because Fidelity and TD Ameritrade offer self-directed accounts, their platforms have many more features. Advanced charting with many tools is available, as are sophisticated order tickets. On their mobile apps, there is live streaming of financial news (Fidelity uses Bloomberg, while TD Ameritrade uses CNBC). We also found Level II quotes and direct-access routing at both brokers.

During our inquiry, we found full-screen charting on Fidelity’s website and a pop-up trade ticket. On TD Ameritrade’s platform, there is a permanent trade bar at the bottom of the screen. Unlike Fidelity’s tool, TDA’s can submit orders for option contracts.

Both TD Ameritrade and Fidelity offer desktop platforms where traders will find lots of advanced tools. TD Ameritrade’s software can be used to trade currencies and futures contracts.


Ameritrade


The victory here goes to TD Ameritrade.


Category 4: Educational Resources


Learning materials are available to Acorns clients in both video and article format. They appear on the company’s website and mobile app. We found tips on paying off debt and information on how to use Acorns’ round-up system.

Fidelity and TD Ameritrade offer much more. Both companies offer free stock reports in pdf format. For Microsoft, we found 14 reports at Fidelity and 8 at TD Ameritrade. Both brokerage firms have excellent screeners that are able to search for investment opportunities. For some reason, Fidelity’s mutual fund screener doesn’t have the ability to search by load status. TD Ameritrade’s does.

TD Ameritrade also operates its own video channel. It streams online for free. Some of the programming we found includes futures and stock market commentary.

General investment education hasn’t been left out at any of the three brokers, although Fidelity and TD Ameritrade have much larger libraries. We found articles, webinars, videos, and self-guided courses on topics such as how to generate income from covered calls and how to construct a bond ladder.

TD Ameritrade is the best choice here.


Category 5: Portfolio Management


Managed account services are available at all 3 companies in this competition. And in fact, that’s all Acorns offers. The monthly fee is between $1 and $3, which would be a pretty good deal for large accounts. But there’s an extremely small investment selection.

A larger selection is available with Fidelity’s or TD Ameritrade’s robo service. Fidelity’s costs 35 basis points per year with no minimum deposit requirement; while TD Ameritrade charges 0.30% with a $500 minimum. Boring traditional management with a human advisor is available (at an additional cost and a higher minimum) at both firms.

Fidelity and TD Ameritrade have a tie.


Fidelity


Category 6: Other Services


TD Ameritrade and Fidelity both offer free DRIP service for stocks and ETFs; while Acorns’ software reinvests cash dividends from the six ETFs as additional shares.

Fidelity and TD Ameritrade customers can sign up for periodic deposits into mutual funds (Fidelity offers online enrollment, while TD Ameritrade requires a paper form).

IRAs are on tap at all three brokerage houses; although Acorns offers fewer types.

Fidelity has a slight edge here.


Our Recommendations


Beginners: We recommend either Fidelity or TD Ameritrade over Acorns. Although Acorns hopes to attract newbies, Fidelity and TD Ameritrade have much better customer service departments. Fidelity is the lone broker in this contest to have a regular human chat service. We also like TD Ameritrade’s large network of branch locations.

Mutual Fund Traders: With Fidelity’s screener we found 10,023 funds available for purchase. TD Ameritrade offers 13,000+. Selections of both lists come with no load and no transaction fee. Both brokers have thorough profile pages. TD Ameritrade has the better screener; so it gets our stamp of approval.

Retirement Savers and Long-Term Investors: All three have positive attributes here; but Acorns’ small ETF selection is a no go. Fidelity and TD Ameritrade both offer financial planning, individual 401(k)s, annuities, and target-date mutual funds. We can endorse either.

ETF and Stock Trading: Fidelity provides more stock reports than TD Ameritrade, although the latter broker has a more advanced trading platform. Toss up.


Promotions


TD Ameritrade: $0 commissions + transfer fee reimbursement.

Acorns: Get $10 when you open an Acorns account with this referral link.

Fidelity Investments: Get $0 stock commissions.



TD Ameritrade vs. Acorns vs. Fidelity: Results


Acorns didn’t win a single victory. It may attract younger investors, but it looks like they would be better off at TD Ameritrade.


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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 Brokerage-Review.com, Chad can usually be found managing his portfolio or building a new home computer.