Financial planning can be intimidating. Fortunately, you don’t have to be an expert to take your money to the next level, especially when the firms Charles Schwab and TD Ameritrade can provide the guidance and resources you need. Both companies have their own set of strengths and weaknesses, so it might be difficult to decide which one is right for you. If it comes down to Charles Schwab vs Ameritrade, here’s what you need to know.
Whether you’re a beginner or an advanced investor, Charles Schwab is an excellent place to park your money. Choose from a wide selection of investments, such as:
- Mutual Funds
- EFTs (exchange-traded funds)
- Global Investing
- Money Market Funds, Bonds, Certificate of Deposits
- Annuities and Insurance
- Retirement Options
Charles Schwab is unique because unlike some brokerage firms, you can use the company for your banking and lending needs. It also offers high-yield checking accounts, high-yield savings accounts, credit cards, home equity loans and mortgage loans (new purchases and refinances). The ability to bank and invest with the same financial institution means you’re able to move funds between your banking and investment accounts quickly and easily.
In fact, some customers have praised the company for offering more than just investments. One reviewer stated, “I am a Schwab customer and have been for years. One of the benefits of being a brokerage customer is access to their banking products too.”
For the most part, online reviews of Charles Schwab are positive. According to another reviewer, “For those seeking access to low costs, excellent research, quality trade tools and professional planning for the future, Charles Schwab will not disappoint.”
But while the company ranks high for its products and low fees, there were a few complaints about accessibility. “The site is always undergoing maintenance during the weekend, preventing users from accessing their accounts,” says a reviewer on TrustPilot. “It makes it very challenging to use for busy people who spend their week working and want to manage their accounts during the weekend.”
Other Charles Schwab features:
- 24/7 customer service, 365 days a year
- No-fee Professional Portfolio Management
- One-on-One Portfolio Consultation (for accounts of at least $25,000)
- Nationwide branches
TD Ameritrade is another option if you’re a seasoned or beginner investor. Investment products include:
- Mutual funds
- Bonds and Certificate of Deposits
TD Ameritrade even offers cash management solutions to help you manage your money from one account. You can deposit checks and use your account to pay bills online. In addition, you’ll enjoy check writing privileges, and with your Visa debit card you can withdraw money from an ATM — all with no monthly maintenance fee.
One reviewer stated, “This brokerage company has been excellent in the service it provides to its business customers, with helpful, courteous, reliable, available, and knowledgeable account representatives.”
But although Ameritrade goes over and beyond to provide a good customer experience, and has mobile trading applications for Blackberry, iPhone, Android and Windows phone, some users experience the same accessibility issues as Charles Schwab customers. According to another reviewer, “TD Ameritrade’s web or IOS app are simply not highly available. They are prone to frequent logon and timeout issues if you have multiple linked accounts.”
Other TD Ameritrade features:
- No minimum opening deposit
- Educational and research resources
- Multiple, no-fee trading platforms
- Free access to a trading specialist
Between the two, which brokerage firm will you choose? Reddit users had plenty of advice to give in this regard. But before looking into these reviews, there’s a few things to keep in mind when comparing both brokerage firms.
Since the goal of signing up with a brokerage firm is to improve your financial health, it only makes sense to compare the cost of certain trades.
Charles Schwab is attractive with its low trading fee of $4.95 for Stock and Option trades (+ $0.65 per contract). Going with Schwab might seem like a no-brainer given how TD Ameritrade charges $6.95 for Stock and Option trades (+ $0.75 per contract).
Be aware, however, it’s more expensive to get started with Charles Schwab. Most of this company’s brokerage accounts require a minimum deposit of $1,000. On the other hand, there’s no minimum investment amount with TD Ameritrade.
Another difference is the amount of available investments. Charles Schwab advertises more than 3,000 mutual funds on its site. This is impressive until you find out that TD Ameritrade gives clients access to more than 13,000 mutual finds.
TD Ameritrade also offers more EFTs than Charles Schwab, 296 and 244, respectively. Therefore, if your focus is trading, Ameritrade might be more up your alley. In fact, one Reddit user encourages going with Schwab, if you’re “not” trading. He notes “TD Ameritrade is much quicker to get your order out and suited for trading. [I can] click on a chart, sell and I’m out in about two seconds.”
Both companies have apps that customers can download to their Apple and Android devices, which is perfect for on-the-go investing. Reddit users didn’t have much to say about Ameritrade’s app. But a few users related positive experiences with Schwab’s app. One user preferred Schwab for the simple fact that its interfaces are more user friendly — desktop, phone and browser.
Another user stated that they also liked the Schwab app and haven’t had issues, but usually uses a desktop to buy and sell. This user admitted to never using Ameritrade app, so they don’t know how it compared to Schwab’s.
The bottom line is that either brokerage firm can help achieve your financial goals. Still, don’t make a hasty decision. Decide what features are most important to you, and then choose a firm that can accommodate your needs.