How To Open Accounts With Vanguard, Fidelity, And Schwab

Most everyone has heard of Vanguard, Fidelity, and Charles Schwab. After all, they are the three top investment management firms in the U.S.

Since they are three of the best in their field, it may be hard to decide which will work best for you.

Well today, I'll talk about the differences between the three and show you step-by-step how to sign-up for an account with each.

That should help you decide which company is right for you!

Vanguard

Types of investment accounts

Brokerage Accounts
Roth IRA
Traditional IRA
Simple IRA
Rollover IRA
SEPs
Individual 401(k)
529 College Savings
Annuities

Potential investments

Mutual Funds
ETFs
Stocks
Secondary Market CDs
Bonds
Option Contracts

Fees

With Vanguard, you’ll only pay an expense ratio with mutual funds and ETFs. According to Vanguard, their expense ratio is 82% less than the industry average. Notably, you can buy and sell nearly every non-leveraged ETF commission-free on the Vanguard platform.

At the time of writing, Vanguard’s average expense ratio is 0.11%, while the industry average expense ratio is 0.62%.

Vanguard also has a few more fees, including:

$20 annual fee that applies to each of your brokerage and mutual-fund-only accounts, if you have less than $10,000 invested and want paper statements.
Vanguard’s Personal Advisor Services fee is an optional advisor service and charges 0.30% of assets under management.
If you are purchasing individual stocks, the commissions are $7 per trade. If you have over $500,000 invested the price drops to $2 per trade.

Convenience

Open accounts for a low minimum

You can open a Vanguard Target Retirement Funds and Vanguard STAR^® Fund for $1,000, most other mutual funds require a $3,000 minimum. You can check out their minimums for mutual funds here.

If $3,000 is more than you have right now to get started, you can invest in an ETF for the price of one share of the ETF. According to their website, this generally ranges from $50 to a few hundred.

It takes just a few steps to open an account

As you'll see below, opening an account with Vanguard is simple.

Throughout the application process, Vanguard tells you what to expect on the next step. Plus, the application only takes about 5-10 minutes to finish.

Other features

Customer service

Like any good company, Vanguard has a customer service line that you can call Monday through Friday.

Overall, I've found that getting in contact with a real person isn't at all difficult with Vanguard.

The company is owned by the shareholders

Vanguard is owned by the Vanguard funds, which in turn means it's owned by the folks who have investments with them. There are no outside owners, meaning there is no incentive for the company to charge unnecessary fees. Any extra profits would simply be returned to the company owners, who are effectively the customers.

Vanguard's interests are completely aligned with their clients because the clients are the owners.

Step-by-step with screenshots of how to open and set up an account

Vanguard's application process is incredibly easy. It's a few steps, and they even tell you exactly what you're going to be doing (see below).

Since I don't intend to open an account with Vanguard, I'll give you the first few steps so you can decide for yourself if Vanguard seems right for you.

Step 1: Opening an account

Your first step is to choose if you're a new investor or if you want to move an account over to Vanguard.

For the purposes of this example, I clicked "open a new account".

Step 2: Register

If you're new to Vanguard, you'll need to register for an account. Again, for this guide, I said I was new and needed to register.

Step 3: Open an account

Vanguard is super helpful and shows exactly what will be on their application process. According to Vanguard, their whole application process takes just 5-10 minutes.

You'll have to start by picking an account type, so make sure you know what you're looking for.

After you choose what kind of account you want to open, you'll need to fund the account (obviously). After that, you finish the 5-10 minute application and you're on your way to being a Vanguard investor!