Charles Schwab & Co., Inc., more familiarly known to most as just Schwab, is one of the world’s leading financial institutions. The industry giant offers brokerage and retirement accounts, annuities, high-yield checking accounts, and a whole lot more.
Schwab also offers some great promotions from time to time, making them one to keep on your radar if you’re keen to cash in on a sign-up bonus.
Keep reading to learn more about Schwab’s latest promotions for 2021 and get a quick overview of the company.
Top Schwab Promotions for 2021
Option I: Referral promotion
Current Schwab customers who have friends that want to start investing should consider directing them to Schwab. Your friend could earn a nice chunk of change just for opening a Schwab brokerage account.
How Charles Schwab’s referral offer works
1. Find a contact
Find a contact who wants to sign up. This could be a friend, family member, coworker, neighbor, or teammate. Ideally, it’s someone that you trust with financial advice, and that trusts you with the same.
2. Send a link
Send your contact a referral link via email or SMS (you can get the link from your Schwab account).
3. Have your friend sign up with Schwab
Have the friend sign up for a new account with Schwab. The friend should include your referral code when prompted.
4. Receive up to $500
The individual can receive up to $500 for signing up. The money will be deposited roughly 30 days after opening and funding the account.
How the bonus is awarded
There’s a catch to this promotion — the person signing up has to meet a qualifying net deposit.
Here is a breakdown of the account bonuses and deposit amounts.
- $100 Schwab referral bonus requires a minimum deposit from $25,000 to $49,999
- $300 Schwab referral bonus requires a minimum deposit from $50,000 to $99,999
- $500 Schwab referral bonus requires a minimum deposit of at least $100,000
Unfortunately, you as the referrer won’t receive a bonus award for signing your friend up. So if you’re looking to benefit from this, you won’t.
However, if you aren’t a Schwab customer yet, and are interested in becoming one, it might be worth asking your close network if they have a referral link available.
Option II: Commission-free online options trades
Schwab’s other promotion for 2021 can enable customers to get 500 commission-free online options trades for two years.
How it works
1. Enroll with Schwab
Start by opening an online brokerage account through Schwab.
It should be noted that the company is also offering commission-free options incentives for retirement accounts (traditional IRAs, Roth IRAs, and Rollover IRAs), as well as checking accounts (individual and joint).
2. Make a qualifying net deposit
Next, you’ll have to make a qualifying net deposit of at least $100,000 in cash or securities. If you don’t have this much money sitting in an account, and you don’t expect to have it in the near future, you won’t be able to access this promotion.
3. Get rewarded
Once you go through the account opening and funding process, you can earn up to 500 commission-free online options trades from Schwab.
This offer is available to both new and existing Schwab clients. To receive the offer, you have to make a qualifying net deposit in an eligible account within 45 days after enrolling.
TradeStation attracts advanced and casual investors alike, because of its easy-to-use software, fast execution speeds, and advanced features that rival any of the other popular brokers.
Is options trading a good idea?
Disclaimer: Schwab’s options incentive should only be taken up by serious investors who know what they are doing.
Options enable, but don’t require, buyers to purchase or sell assets at a certain price at specific times. This play is much riskier than stocks, and if you’re new to investing, it’s advisable to stay away. Trading options as an inexperienced investor is an easy way to lose money.
Charles Schwab promotions: An assessment
Schwab’s current promotions are better suited for experienced investors who don’t really need a cash bonus incentive for signing up. This is not a place where you can expect to earn free stock, for example, that other providers might offer.
That said, Schwab is still an excellent financial broker. In fact, Schwab is consistently rated one of the best platforms on the market for its reasonable fees, powerful online platform, and abundance of investment tools and opportunities.
Let’s take a closer look at Schwab to see what the company has to offer.
Charles Schwab: An Overview
What is Schwab?
Schwab is the consumer-focused investing division of the Charles Schwab Corporation, which has over $3.2 trillion in assets under management.
As a Schwab account holder, you can access a variety of financial products, including stocks, bonds, exchange-traded funds, mutual funds, and index funds through a centralized dashboard.
The company also operates an online bank, called Charles Schwab Bank, which offers a High-Yield Investor Checking Account, a High-Yield Investor Savings Account, and more.
Benefits of using Schwab
Here are some of the top benefits of using Schwab.
Top-rated customer support
Not all investors are alike. Some investors prefer to work independently and make their own decisions, while others want the guidance and support of a dedicated advisor.
Schwab offers both options, enabling investors to access the level of control and support that they require.
Top-level retirement services
Aside from traditional brokerage services, Schwab provides an array of retirement-planning products. So if you’re looking to do an IRA rollover or start an employer-sponsored 401(k), you can do so through Schwab.
With no minimum initial investment required and no trading fees on stocks, ETFs and options, you can't go wrong investing with Ally.
Uptime and availability are critical for success when investing. The last thing you want to do is try and log in to make a timely trade, only to be denied access to your account.
Schwab offers a robust platform that’s more or less guaranteed to work when you need it.
Schwab review for 2021
Next, let’s take a quick look at Schwab’s most popular services and features.
Schwab offers commission-free online trades on stocks, ETFs, and mutual funds. Truth be told, this isn’t that big of a deal because free trades are standard these days for most online brokers.
At the time of writing, Schwab charges $0.65 for options contracts and a $1.50 fee for futures. If you make a broker-assisted trade, you will be looking at additional fees.
There are no monthly fees for Charles Schwab Bank, and both the High-Yield Checking and Savings accounts offer worldwide ATM fee reimbursement.
Schwab offers one of the most comprehensive mobile apps on the market.
The Schwab Mobile app is rated at 4.8 stars (out of 5) in the App Store and 3.1 stars in the Google Play Store.
Through the app, investors can access their accounts, deposit checks, make on-the-go trades, and more.
Not all financial companies today are prioritizing customer service from real humans. This is another area where Schwab shines.
By using Schwab, it’s possible to access support on a 24/7 basis by phone or chat.
Best of all, Schwab also offers in-person financial services with nationwide coverage. So if you prefer to work with an on-site dedicated staff, this is possible through Schwab.
Schwab offers full encryption and strong multi-factor authentication for secure logins using biometrics. So you can use Schwab confidently knowing that your data is safe and secure.
Alternatives to Schwab
Some alternative brokerage firms to Schwab include Merrill Edge, Fidelity, TD Ameritrade, and Vanguard. Chase and Bank of America also offer investment options, however, you are probably looking at more fees with both of those providers.
Here are some key takeaways and considerations when shopping for an investment platform.
Availability is crucial
Make sure that the vendor you select is committed to uptime and availability. Read online reviews and check the services that the vendor has to make sure they provide a robust platform that will be there when you need it.
With Schwab, uptime and availability aren’t something you’ll have to worry about.
Customer service is key
Eventually, you’re going to run into a question and require support. It may have to do with opening a taxable account or figuring out how to rollover your old 401(k).
Again, this is where Schwab shines. You can approach their customer service department with just about any financial or technical question and receive a prompt and accurate answer.
Don’t settle for anything less than first-class security when trusting a vendor with your financial data.
Security is another benefit at Schwab, which even offers 100% coverage for any losses due to unauthorized activity.
Retail brokerage promotions are overrated
A word of advice: Be leery of cash back promotions when shopping for a retail brokerage account. Select a broker because you like the company and could envision yourself working with them for many years to come. Any extra promotions that come with it should be complementary.
With that said, Schwab’s current promotions probably make more sense for experienced investors and people who don’t need brokerage bonuses.
Commission-free trades are overrated
Finally, don’t get caught up on promises about commission-free trading. In the grand scheme of things, commissions don’t amount to much. You may save a couple of bucks over the course of the year, but it’s not enough to significantly move the needle.
Frequently Asked Questions
Is Charles Schwab Bank better than Robinhood?
Schwab offers a level of trust, visibility, and control that you won’t find a Robinhood. While Robinhood caters more to beginner investors, Schwab offers a much more robust experience.
Use Schwab if you plan to take a more serious approach to investing and want access to a greater selection of offerings.
Robinhood - Free Investing App
With Robinhood, you can start investing without any transaction fees.
Does Schwab offer a robo advisor?
Schwab offers automated investing with a robo advisor through Schwab Intelligent Portfolios. So if you’re looking for automated assistance on a trading platform, Schwab has you covered there, too. Betterment, Personal Capital, and Wealthfront are some other popular robo advisor services worth looking into.
The Bottom Line
There is no better way to grow your money than to invest it.
Opening a Charles Schwab account and sticking to a sound investment plan could be one of the best personal finance decisions that you ever make.
While the company doesn’t have the most attractive bonus offers right now, that shouldn’t matter much. Most successful investors position themselves for long-term success — not to make a quick buck.
Here’s to finding the best brokerage account for your unique financial situation and strategy.