Charles Schwab Review

By | March 5, 2021

Charles Schwab is a US based discount broker which was founded in 1991. It is also listed on the New York Stock Exchange. It is regulated by financial regulators like; SEC, FINRA & FCA. It has a good operating history which makes it safe to deal with. 

Charles Schwab

Account Opening

Account opening process at Charles Schwab is easy, hassle free and fully digital. It takes a few time to activate your account after which you can start trading. 

What is the minimum deposit at Charles Schwab?

The required Charles Schwab minimum deposit is different for US and non-US clients:

  • $0 for US clients
  • $25,000 for non-US clients, which is very high

Charles Schwab is a US discount broker that primarily targets US clients, but its services are available to clients in more than 40 other countries as well, including e.g. the United Kingdom, Germany, Australia, China, Hong Kong, India, Malaysia, Singapore and the United Arab Emirates.

Charles Schwab

Account Types 

Account Type Short Description
Brokerage individual accountAccount is owned and used by a single individual
Brokerage joint accountAccount is owned and used by two or more individuals
Corporate AccountAccount is owned and used by a legal entity
Trust, Estate AccountsAccount is held by a Trustee (separate legal entity) for your benefit. Estate accounts help you manage and distribute estate assets
Roth IRA AccountTraditional IRA AccountRollover IRA AccountIndividual retirement accounts only available for US clients
Schwab Intelligent PortfoliosSchwab Intelligent Portfolios PremiumRobo-advisor accounts only available for US clients
Schwab Charitable AccountTax-efficient account for a charitable giving, available only in the US
Checking, Savings AccountsIndividual savings account with variable interest rates or unlimited ATM rebates
Education, Custodial AccountsCollege and education savings plans, and custodial accounts

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Fees

Charles Schwab offers free trade for stocks and ETFs. Even some of the mutual funds are also free to trade, while others may have high trading fees. It charges low non-trading fees. 

Charles Schwab Fee snapshot

AssetsFee Terms
US stockFree stock and ETF trading
EURUSD
Mutual fund$49.5 for buying while selling is free; there are also around 4,000 free mutual funds
Inactivity feeNo inactivity fee

Charles Schwab charges no commission for stock and ETF trading, which is amazing. 

If you prefer stock trading on margin, you should check Charles Schwab’s margin rates.

Charles Schwab annual margin rate tiers

Debit BalanceRateBase rate +/-
$250,000 – $499,9996.575%Base rate +0.075%
$100,000 – $249,9996.825%Base rate +0.325%
$50,000 – $99,9996.875%Base rate +0.375%
$25,000 – $49,9997.825%Base rate +1.325%
$0 – $24,9998.325%Base rate +1.825%

Charles Schwab Commission rates

US stock$0.0
Mutual fund$24.8
US Treasury bond$0.0
US stock index options$6.5
US micro e-mini stock index futures$15.0 

Deposit and Withdrawal

Charles Schwab doesn’t charge any deposit fee. You can make deposits only through bank transfer. On the other hand, they charge a high fee for wire withdrawal. 

Charles Schwab provides only one currency as a base currency and that is USD.

It charges no deposit fees. US clients can make deposits through check, ACH and wire transfer. But the non-US clients can make deposits only through wire transfer. 

Charles Schwab charges no withdrawal fees if you use ACH withdrawal, but wire transfers cost $25.

Trading Platform

Charles Schwab trade platform comes in three format :

  1. Web Trading Platform
  2. Mobile Trading application
  3. Desktop Trading Platform

All of the trading platforms are easy to use and are beginner friendly. They provide a safe login and clear fee report. Mobile apps are available in both Android and iOS.

However, desktop trading platforms are not very suitable for beginners. Desktop trading platforms are so advanced and have so many functions. 

Charles Schwab

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Products Offered 

It offers you a vast amount of asset portfolio to trade. It offers everything, from stocks to futures. But the drawback is that it covers only the US and Canadian market. 

Charles Schwab covers only North American markets. You can trade with stocks on the following stock exchanges: NYSE, NYSE MKT, NASDAQ and OTC.

Charles Schwab Asset selection

Stock markets (#)4
ETFs (#)2300
Fund providers (#)600
Bonds (#)60,000
Options markets (#)8
Futures markets (#)8
Charles Schwab

Schwab Intelligent Portfolios

Charles Schwab offers a robo-advisory service called Schwab Intelligent Portfolios. It is great if you need an automated solution to manage your investments.

First, you have to answer questions about your investment goal, risk tolerance, and time horizon. Based on your preferences a portfolio is created and the robo-advisor will automatically rebalance the portfolio when needed. There is a $5,000 minimum amount to start, while there is no commission charged for this service.

If you choose Schwab Intelligent Portfolios Premium you will also get guidance from a personal financial expert. The minimum to start this premium account is $25,000 and there is also a $300 one-time fee. After this, a $30 per month fee is charged.

Charles Schwab

Education

Charles Schwab education tools are average. They have provided high quality videos and articles but not in an organized manner. It also does not provide a demo account for practise. 

At Charles Schwab you can learn in the following ways:

  • Platform tutorial videos
  • General educational videos
  • Webinars
  • Quality educational articles
Charles Schwab

Safety 

Charles Schwab is regulated by the top financial institutions which makes it safer for clients. It also has a good transaction history which makes it clear that it has safely passed the previous economic crisis. Charles Schwab operates several legal entities globally, but all customers are covered by the US investor protection scheme, called the Securities Investor Protection Corporation (SIPC).

SIPC investor protection protects against the loss of cash and securities in case the broker goes bust. The limit of SIPC protection is $500,000, which includes a $250,000 limit for cash

Charles Schwab investor protection and legal entities

Country of Clients Protection AmountRegulator Legal Entity
US and all other countries, except for UK, Hong Kong and SingaporeSIPC: $500,000 ($250,000 cash limit)Securities and Exchange Commission (SEC) Financial Industry Regulatory Authority (FINRA)Charles Schwab & Co., Inc.
UKSIPC: $500,000 ($250,000 cash limit)Financial Conduct Authority (FCA)Charles Schwab, U.K., Limited
Hong KongSIPC: $500,000 ($250,000 cash limit)Hong Kong Securities and Futures CommissionCharles Schwab, Hong Kong, Ltd.
SingaporeSIPC: $500,000 ($250,000 cash limit)Monetary Authority of Singapore (MAS)Charles Schwab Singapore Pte. Ltd.
All countries – Futures accountsNo protectionCommodity Futures Trading Commission (CFTC)Charles Schwab Futures, Inc.

Customer Service

You can contact them in English via:

  • live chat
  • phone

The Charles Schwab support team is available 24/7, which is a big plus.

ProsCons
 Free stock and ETF tradingHigh fees for some mutual funds
 Low non-trading feesPoorly-structured educational platform
No minimum deposit $25,000 minimum deposit for non-US clients
 User-friendlyHigh fee for wire withdrawals
Data on asset fundamentalsNo demo account
Charles Schwab

Bottom Line

Charles Schwabs’ fees are great. You can trade stocks and ETFs listed on major US markets for free. Account opening is easy, fully digital and fast. Customer service responds quickly and gives relevant answers.

It has some drawbacks though. It is available only for US clients. Its product portfolio is fairly limited, covering only US stocks, ETFs, and a few cryptocurrencies. Lastly, research tools are very basic.

As the account opening process is seamless and Charles Schwab offers commission-free stock and ETF trades, you should feel free to try it.


FAQ’s

Who’s eligible to receive Social Security benefits?

To qualify for Social Security, you or your spouse need to have paid the Social Security payroll tax for at least 10 years. A nonworking spouse is potentially entitled up to half of a spouse’s benefit. 

What is covered by the Satisfaction Guarantee?

We believe every investor deserves to work with a firm they can count on. At Schwab, our commitment to your satisfaction is backed by a guarantee. If for any reason you’re not completely satisfied, we’ll refund your eligible fee or commission and work with you to make things right. You won’t find that kind of promise everywhere—but you will find it here.

How much money do I need to get started?

Investment minimums vary by service, from as little as $5,000 for Schwab Intelligent Portfolios, to $500,000 for Schwab Advisor Network, and as much as $1 million for Schwab Private Client.

What account types are available for investment advice?

Our services are available in a wide variety of accounts, including individual and joint brokerage; traditional, Roth and rollover IRA; trust and custodial accounts.

Charles Schwab Review

9.2

Fees

9.1/10

Account Types

9.2/10

Trading Platform

9.4/10

Customer Service

9.0/10

Pros

  • No minimum deposit
  • User-friendly

Cons

  • No demo account
  • High fee for wire withdrawals

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