The 7 best online brokerages for beginners

By August 3, 2022DeFi
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  • Best for beginners
  • Best for beginners runner-up
  • Best for all levels of investors
  • Best for active trading
  • Best for retirement-focused investors
  • Best for robo-advising
  • Best for banking-brokerage combo
  • Other brokerages we considered
  • How we determine winners
  • Frequently asked questions
  • Insider's experts choose the best products and services to help make smart decisions with your money (here’s how). In some cases, we receive a commission from our our partners, however, our opinions are our own. Terms apply to offers listed on this page.

    The best online brokerages for beginners offer low or no fees, an intuitive interface, and a variety of account types to serve your needs. To make our selections, we considered pricing and fees, investment options, account types, investment platforms, investment research, and education resources.

    Best brokerages for beginners

    • Charles Schwab
    • SoFi Invest
    • Fidelity
    • TD Ameritrade investment account
    • Vanguard
    • Betterment
    • Ally Invest

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    Editor's Rating

    4.88/5

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    Fees It indicates an expandable section or menu, or sometimes previous / next navigation options.

    $0 trading or automated investing ($300 one-time fee plus $30/month for Schwab Intelligent Portfolios Premium)

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    Beginners

    Editor's Rating

    4.65/5

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    Fees It indicates an expandable section or menu, or sometimes previous / next navigation options.

    $0 trading or automated investing

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    Beginners (runner-up)

    Editor's Rating

    4.86/5

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    Fees It indicates an expandable section or menu, or sometimes previous / next navigation options.

    $0 trading; $0 to 0.35% automated investing

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    All levels of investors

    Editor's Rating

    4.73/5

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    $0 trading; 0.60-0.90% AUM

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    Active trading

    Editor's Rating

    4.6/5

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    Fees It indicates an expandable section or menu, or sometimes previous / next navigation options.

    0% (0.20% to 0.30% for professionally managed portfolios)

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    Retirement-focused investors

    Editor's Rating

    4.5/5

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    Fees It indicates an expandable section or menu, or sometimes previous / next navigation options.

    0.25% or 0.40%/year

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    Robo-advising

    Editor's Rating

    4.08/5

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    Fees It indicates an expandable section or menu, or sometimes previous / next navigation options.

    $0 trading or automated investing

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    Banking-brokerage combo

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    On Charles Schwab's website

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    On SoFi's website

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    On Fidelity's website

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    On TD Ameritrade's website

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    On Vanguard's website

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    On Betterment's website

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    On Ally's website

    Best for beginners: Charles Schwab

    Charles Schwab

    Account Minimum

    $0 ($5,000 for Schwab Intelligent Portfolios; $25,000 Schwab Intelligent Portfolios Premium)

    Fees

    0% ($0 Schwab Intelligent Portfolios; $30/month Schwab Intelligent Portfolios Premium)

    Investment Types

    Stocks, ETFs, options, futures, mutual funds, money market funds, bonds, crypto trusts, and annuities

    4.88/5

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    4.88 out of 5 Stars

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    Charles Schwab

    4.88/5

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    4.88 out of 5 Stars

    Editor's Rating

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    Account Minimum

    $0 ($5,000 for Schwab Intelligent Portfolios; $25,000 Schwab Intelligent Portfolios Premium)

    Fees

    0% ($0 Schwab Intelligent Portfolios; $30/month Schwab Intelligent Portfolios Premium)

    Investment Types

    Stocks, ETFs, options, futures, mutual funds, money market funds, bonds, crypto trusts, and annuities

    Pros & Cons It indicates an expandable section or menu, or sometimes previous / next navigation options.

    Pros

    • No minimums; commission-free trading on stocks, ETFs, and options
    • Thousands of no-load mutual funds and 50+ Schwab-managed funds; fractional shares (Stock slices) available
    • Automated and advisor-managed accounts available
    • Multiple trading platforms; stock screeners and other trading tools

    Cons

    • $5,000 minimum for automated Schwab Intelligent Portfolios is on the higher end
    • Schwab's no-load funds have a $100 minimum; some competitors offer lower minimums

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    • App store rating: 4.8 iOS/3.8 Android
    • Consider it if: You want a wide range of account types, with easy-to-use apps and web interfaces

    Why Charles Schwab made our list:

    Charles Schwab is our choice for best overall brokerage for beginners because it offers something for investors with virtually any investment need. Not only does it give you the ability to manage all of your banking and investments with one login, but its investment tools are also designed in a way that they can grow with you as you learn more and level up your investing style.

    For investors who want to manage everything themselves, you can choose self-directed traditional brokerage and retirement accounts where you pick all of your investments with no commissions for stock or ETF trades. These accounts have no fees and no minimum balance requirements. Schwab also offers a robo-adviser, Schwab Intelligent Portfolios, that can manage all of your investments for you for no added charge. But you'll need at least $5,000 to use this account.

    If you want to take automated investing a step further, you can upgrade to Schwab Intelligent Portfolios Premium. This account combines robo-advice with unlimited guidance from a certified financial planner (CFP). Note, however, that you'll need a minimum of $25,000 to get started. The account has a $300 one-time planning fee and includes a $30 monthly fee.

    Schwab is best for investors who want every potential investment need covered at a very low cost. Whatever your needs are in the future, odds are Schwab will have a solution that works for you.

    What to look out for: Schwab's robo-advisor, Schwab Intelligent Portfolios charges no advisory fees, but it has a higher account minimum requirement ($5,000) than most automated accounts.

    Best for beginners runner-up: SoFi

    SoFi Invest

    Account Minimum

    $0 ($1 to start investing)

    Fees

    0% for active trading and automated investing (1.25% for cryptocurrencies)

    Investment Types

    Stocks, ETFs, and cryptocurrencies

    4.65/5

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    4.65 out of 5 Stars

    Editor's Rating

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    SoFi Invest

    4.65/5

    A five pointed star A five pointed star A five pointed star A five pointed star A five pointed star

    4.65 out of 5 Stars

    Editor's Rating

    Learn more

    Account Minimum

    $0 ($1 to start investing)

    Fees

    0% for active trading and automated investing (1.25% for cryptocurrencies)

    Investment Types

    Stocks, ETFs, and cryptocurrencies

    Pros & Cons It indicates an expandable section or menu, or sometimes previous / next navigation options.

    Pros

    • No minimum to start investing
    • No account or trading fees, and low fees to own funds
    • Access to Certified Financial Planners at no additional charge
    • Cryptocurrency trading available

    Cons

    • No tax-loss harvesting, an advanced investing technique where you sell a stock or mutual fund at a loss for a tax benefit
    • No option for stop-loss orders when actively investing. SoFi's active investing account only uses market orders
    • Currently only available to US residents

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    • Promotion: Get up to $100 in bitcoin when you make your first trade.
    • App store rating: 4.8 iOS/4.2 Android
    • Consider it if: You want an easy-to-use platform paired with rock-bottom pricing.

    Why SoFi made our list:

    SoFi is best for investors looking for a simple and straightforward investing experience. It has a slimmer lineup of accounts than some bigger competitors, but it covers the most common needs for managing your investments. It also offers a great bank account, lending products, and other financial tools to help you get an understanding of your investments.

    SoFi offers active investing accounts and managed robo-adviser accounts with no recurring fees and a $1 minimum to get started. Those include both taxable investment accounts and IRA or Roth IRA retirement accounts. The only big downside of these accounts is that you can only trade stocks, ETFs, and cryptocurrencies. There are no mutual funds available through SoFi. Stock and ETF trades are commission-free. SoFi offers automated investing for $0.

    On the cryptocurrency end, you can exchange bitcoin, ethereum, litecoin, and more than 27 other coins and tokens. SoFi charges a 1.25% markup on each crypto transaction.

    While it doesn't have quite as robust an offering, SoFi comes with several very valuable perks at no extra charge. That includes free financial planning sessions, career coaching, and other perks for SoFi members. SoFi is best for inventors who are comfortable with technology.

    What to look out for: While SoFi is generally a great choice for investors who value low costs, it has a fairly limited investment selection. It primarily offers stocks, ETFs, and cryptocurrencies.

    Best for all levels of investors: Fidelity

    Fidelity

    Account Minimum

    $0 ($25,000 Fidelity Personalized Planning & Advice)

    Fees

    0% ($0, $3/month, or 0.35% for robo-advisor)

    Investment Types

    Stocks, ETFs, options, mutual funds, bonds, CDs, annuities, and IPOs

    4.86/5

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    4.86 out of 5 Stars

    Editor's Rating

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    Fidelity

    4.86/5

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    4.86 out of 5 Stars

    Editor's Rating

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    Account Minimum

    $0 ($25,000 Fidelity Personalized Planning & Advice)

    Fees

    0% ($0, $3/month, or 0.35% for robo-advisor)

    Investment Types

    Stocks, ETFs, options, mutual funds, bonds, CDs, annuities, and IPOs

    Pros & Cons It indicates an expandable section or menu, or sometimes previous / next navigation options.

    Pros

    • No account minimum or account fees
    • No commissions for stock, ETF, and options trades; fractional shares available
    • Thousands of no-transaction-fee mutual funds and fee-free mutual funds
    • Several research tools and trading platforms available

    Cons

    • Fidelity Go accounts cost more for investors with higher account balances
    • Representative-assisted trades are slightly more expensive than other brokerages
    • No cryptocurrencies

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    • Promotion: None at this time
    • App store rating: 4.8 iOS/4.3 Android
    • Consider it if: You're focused on long-term investing and retirement.

    Why Fidelity made our list:

    Fidelity is a top choice if your main goal is investing for retirement. Fidelity offers a wide range of accounts with no fees or minimum balance requirements, as well as a suite of investor tools and resources focused on helping customers reach their retirement goals.

    In addition to free stock and ETF trades, Fidelity customers have access to nearly 3,500 mutual funds with no transaction fees. Among those are four funds from Fidelity that charge no expense ratio (that means no fund fees).

    Fidelity also offers a handful of useful tools and calculators. One favorite is the Retirement Score, which helps you assess your retirement preparation and includes guidance to help you reach your goals. Fidelity Go is Fidelity's robo-adviser offering; it's a solid product, though fees are slightly higher on some balances than competitors such as Betterment.

    Fidelity is a large brokerage that can handle just about anything. But retirement is definitely a specialty.

    What to look out for: The brokerage offers a long list of tradeable assets, but it isn't the best option for those who want to invest in cryptocurrencies.

    Best for active trading: TD Ameritrade

    TD Ameritrade investment account

    Account Minimum

    $0 ($5,000 or $25,000 for managed accounts through Schwab)

    Fees

    0% ($300 one-time fee and $30/month for advisor-managed account through Schwab)

    Investment Types

    Stocks, ETFs, options, mutual funds, futures, forex, IPOs, and bonds

    4.73/5

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    4.73 out of 5 Stars

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    TD Ameritrade investment account

    4.73/5

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    4.73 out of 5 Stars

    Editor's Rating

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    Account Minimum

    $0 ($5,000 or $25,000 for managed accounts through Schwab)

    Fees

    0% ($300 one-time fee and $30/month for advisor-managed account through Schwab)

    Investment Types

    Stocks, ETFs, options, mutual funds, futures, forex, IPOs, and bonds

    Pros & Cons It indicates an expandable section or menu, or sometimes previous / next navigation options.

    Pros

    • Free commissions on stock, ETF, and option trades
    • No minimum requirement to get started with brokerage account
    • Large investment selection
    • Research and educational resources available

    Cons

    • No fractional shares
    • Robo-advice and managed portfolios are more expensive
    • No cryptocurrencies

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    • Promotion: None at this time.
    • App store rating: 4.5 iOS/3.5 Android
    • Consider it if: You want multiple apps for different trading experiences and goals

    Why TD Ameritrade made our list:

    If you have plans to manage your account actively and are interested in the fast-moving world of options trading, TD Ameritrade could be the best choice for your needs.

    TD Ameritrade offers similar low fees to other large investment brokerages, with many account types available with no recurring fees and no minimum balance requirements. As with most other brokerages on this list, there are no fees for stock or ETF trades as well as no base fee for options trades.

    TD Ameritrade stands out for active traders due to its suite of investment platforms. Brand new investors will probably be most comfortable on the TD Ameritrade website and using the standard TD Ameritrade mobile app. As your investment chops improve, you can upgrade to the professional-quality thinkorswim mobile and desktop platforms.

    One thing to note about TD Ameritrade is its acquisition by Charles Schwab. Schwab is our top brokerage on this list and plans to keep beloved trading tools from thinkorswim post-acquisition, so it's still worth considering as your new brokerage when starting out. Another thing to note is that TD Ameritrade's robo-adviser and managed accounts — Essential Portfolios, Selective Portfolios, and Personalized Portfolios — are no longer available to new clients.

    You'll have to set up managed or automated accounts through its affiliate, Charles Schwab.

    What to look out for: TD Ameritrade doesn't allow customers to invest in fractional shares.

    Best for retirement-focused investors: Vanguard

    Vanguard

    Account Minimum

    $0 ($3,000 for Vanguard Digital Advisor; $50,000 for Vanguard Personal Advisor Services)

    Fees

    0% (0.20% to 0.30% for professionally managed portfolios)

    Investment Types

    Stocks, ETFs, options, bonds, mutual funds, and CDs

    4.6/5

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    4.6 out of 5 Stars

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    Vanguard

    4.6/5

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    4.6 out of 5 Stars

    Editor's Rating

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    Account Minimum

    $0 ($3,000 for Vanguard Digital Advisor; $50,000 for Vanguard Personal Advisor Services)

    Fees

    0% (0.20% to 0.30% for professionally managed portfolios)

    Investment Types

    Stocks, ETFs, options, bonds, mutual funds, and CDs

    Pros & Cons It indicates an expandable section or menu, or sometimes previous / next navigation options.

    Pros

    • Commission-free stocks, ETFs, and options
    • Brokerage, automated, and advisor-managed accounts available
    • Thousands of low-cost mutual funds
    • Multiple resources with expert analysis and market insights
    • Several retirement accounts and services for retirement plan participants

    Cons

    • Higher options contract fee than other discount brokerages (Vanguard charges $1 per options contract)
    • No separate trading platforms for advanced traders; no fractional shares
    • No cryptocurrencies

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    • Promotion: None at this time.
    • App store rating: 4.7 iOS/ 1.8 Android
    • Consider it if: You're a long-term focused investor looking for access to a variety of account types and investment choices.

    Why Vanguard made our list:

    Formed in 1975, Vanguard has long been a one-stop shop for all things investing. The brokerage's investment selection includes self-directed accounts, automated investing accounts (robo-advisors), IRAs, education savings plans, and much more.

    Plus, like many of the brokerages listed above, it offers commission-free trading for stocks, ETFs, and options. Vanguard also gives you access to mutual funds, bonds, and CDs, and many of its mutual funds are actively managed, meaning the brokerage itself oversees the funds.

    If you're more of a hands-off investor, Vanguard's Vanguard Digital Advisor and Vanguard Personal Advisor Services automated accounts might suit you. The first, Vanguard Digital Advisor, builds a personalized portfolio of Vanguard ETFs for you based on your preferences. Vanguard Personal Advisor Services, on the other hand, is an advisor-managed account that allows you to work one-on-one with experienced Vanguard advisors.

    Beginners might also appreciate the brokerage's vast suite of educational resources. Vanguard offers both a library of insights and guides on a variety of investing topics, and it additionally provides market analysis and expert research.

    What to look out for: While Vanguard offers competitive products for long-term focused investors, some of its products that best suit active traders (e.g., options) fall short of its competitors. For instance, options contracts will cost you $1 each. This is higher than the options contracts fees for many brokerages. In addition, Vanguard doesn't offer any additional trading platforms for advanced traders.

    Best for robo-advising: Betterment

    Betterment

    Account Minimum

    $0 ($100,000 premium plan)

    Fees

    0.25% digital plan; 0.40% premium

    Investment Types

    ETFs

    4.5/5

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    4.5 out of 5 Stars

    Editor's Rating

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    Betterment

    4.5/5

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    4.5 out of 5 Stars

    Editor's Rating

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    Account Minimum

    $0 ($100,000 premium plan)

    Fees

    0.25% digital plan; 0.40% premium

    Investment Types

    ETFs

    Pros & Cons It indicates an expandable section or menu, or sometimes previous / next navigation options.

    Pros

    • No minimum for standard investing account
    • Goal-based planning, tax-loss harvesting, charitable giving, and socially responsible investing available
    • Access to certified financial planners
    • Mobile app with external account syncing options

    Cons

    • You'll have to pay to consult a human advisor, unless you have the premium plan
    • Limited investment selection

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    • Promotion: None at this time.
    • App store rating: 4.7 iOS/4.5 Android
    • Consider it if: You want access to robo-advice with multiple service levels.

    Why Betterment made our list:

    If you are looking for an investment experience where you explain your investment goals, hand over your money, and someone else takes care of everything for you, Betterment could be your best choice. Betterment is the oldest and best-known robo-adviser, an automated investment solution that's quickly growing in popularity.

    The term "robo-adviser" is a bit intimidating to some people, but rest assured an actual robot isn't sitting there picking stocks for you. Instead, you answer some basic questions about your age and investment goals when signing up. Based on your answers, Betterment will assign you to a professionally designed portfolio where your assets are automatically kept in balance, among other computer-driven features.

    Betterment is good for both taxable and retirement accounts. Pricing starts at 0.25% of your portfolio balance per year, though you can pay more for a plan that includes access to a human financial adviser as well. For most beginners, the basic plan covers your needs.

    What to look out for: You'll have to pay extra to take advantage of human advisor guidance if you can't meet the $100,000 minimum attached to Betterment's premium account.

    Best for banking-brokerage combo: Ally Invest

    Ally Invest

    Account Minimum

    $0 ($100 for Robo Portfolios)

    Fees

    0%

    Investment Types

    Stocks, ETFs, options, bonds, mutual funds, and forex

    4.08/5

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    4.08 out of 5 Stars

    Editor's Rating

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    Ally Invest

    4.08/5

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    4.08 out of 5 Stars

    Editor's Rating

    Learn more

    Account Minimum

    $0 ($100 for Robo Portfolios)

    Fees

    0%

    Investment Types

    Stocks, ETFs, options, bonds, mutual funds, and forex

    Pros & Cons It indicates an expandable section or menu, or sometimes previous / next navigation options.

    Pros

    • No account minimums or commissions for trading
    • Automated portfolios free of advisory or management fees
    • Options contracts only cost $0.50 per contract
    • Bank accounts, mortgage refinancing, car loans, and personal loans available through Ally Bank

    Cons

    • Thousands of mutual funds but no no-transaction-fee mutual funds
    • No cryptocurrencies

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    • App store rating: 4.7 iOS/ 3.6 Android
    • Consider it if: You want easy-to-use apps paired with excellent checking and savings accounts.

    Why Ally made our list:

    Most of the brokerages above offer some type of integrated bank account, but if you are looking for the best bank account and brokerage combo, Ally Invest may be the best option for your needs. Ally Bank offers some of the highest-rated checking and savings options out there, and it also offers a low-fee investment platform that works well for beginners.

    The investment side of Ally can handle your taxable or retirement accounts. It features commission-free stock and ETF trades and no base fee for options. Most mutual fund trades are $9.95, which is more than you would pay for mutual fund trades on the no-transaction-fee (NTF) lists at competitors, but less than most charge for funds off of their NTF lists. Managed portfolios are available, too, with no advisory fees and a $100 minimum balance.

    Ally Invest's managed portfolios (also known as robo-portfolios) rely on ETFs, and Ally manages and monitors each portfolio daily. The robo-advisor also offers four different portfolio options: Core, Income, Tax optimized, and Socially Responsible.

    Ally Invest doesn't have the flashiest or fullest-featured trading platform, but it gets the job done and makes it easy for beginners to manage their banking and investments with one login.

    What to look out for: Ally doesn't offer any cryptocurrencies or no-transaction-fee mutual funds.

    Other brokerages we considered

    • Firstrade: Firstrade isn't as well known as some others on this list, but it's been around for decades and offers commission-free trades for most assets including no per-contract fee for options and no commissions for any mutual fund trades. The trading platform doesn't feel as modern and polished as some competitors, but the price is right.
    • Webull: Webull is also almost completely free to use; there are no account fees or trading commissions. You can trade stocks, options, ETFs, and cryptocurrencies. But while it's available account types include taxable investment accounts and IRAs, it doesn't currently offer joint brokerage accounts, education savings accounts, or automated investing options.
    • E-Trade: E-Trade is a major brokerage with a long history of serving online traders. It has a great web platform and works well for beginner to experienced traders. E-Trade is currently in the process of being acquired by Morgan Stanley.
    • Interactive Brokers: Interactive Brokers is best for investors who are looking to become more active traders. It may be good for beginners looking to invest time to learn the markets and how higher-powered trading tools work.
    • Merrill Edge: Merrill Edge is part of Bank of America. It does a good job of rewarding very loyal customers with high balances across Bank of America and Merill accounts. It's less ideal for traders who don't have a strong relationship with Bank of America.

    How we determined the winners

    To pick the best online brokerages for beginners, we considered a dozen brokerages and zeroed in on options that offered competitive pricing and features most important to beginner investors and traders.

    To make it onto this list, brokerages must offer commission-free stock and ETF trades and no recurring account fees (not including robo-advisers). Other important focus areas include available investments, types of accounts, and high-quality investment platforms. Strong investment research and education resources were another plus, but carried less weight in the decision process.

    Frequently asked questions

    What are brokerage accounts?

    A brokerage account is like a checking account for your investments. Where a checking account holds your cash, a brokerage account holds your stocks, bonds, funds, and other investments. When you open and fund a brokerage account, you can buy and sell investments. Unlike the cash in a bank account, however, the value of the investments in your brokerage account can go up and down.

    How do brokerage accounts work?

    It's easiest to manage a brokerage account online using a website or mobile app. Online brokerages allow you to transfer funds, enter trade orders, monitor your positions, research current and future investments, and handle any other transactions you need to make in a brokerage account.

    In the US, brokerage accounts are insured by the Securities Investor Protection Corporation (SIPC). If your brokerage goes out of business, you are guaranteed to get your money and other assets back, up to SIPC limits.

    Brokerage firms are regulated by the Securities and Exchange Commission and Financial Industry Regulatory Authority (FINRA), among other government agencies and industry groups.

    Who should use a brokerage account?

    If you want to invest, you need a brokerage account. That goes for long-term investing for retirement, short-term gains, or anything in between. Make sure you're covering your bills before adding investments to your budget.

    How much should a brokerage account cost?

    Most modern brokerage accounts are free to open and keep. You shouldn't be paying any recurring fees or minimum charges if you're looking for the best brokerage account for most investors.

    You should also look for brokerage accounts with no commissions for stock, ETF, and options trades. You may see some fees for phone or broker-assisted trades, as well as commissions for some mutual funds and other investments.

    You should not have to pay any fees to keep an account open and store your cash and investments there.

    How do I choose an online brokerage?

    The best brokerage for you will reflect your investing style and what you want from a brokerage (for example, robo-advising or active trading, or access to a human financial adviser). Everyone's investment goals and preferences are unique, so there is no perfect brokerage for everyone.

    Once you know what features you're looking for, look at costs, platforms, available account types, and investment options to lock in the decision on what's best for you.

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    Wealth-Building Reporter

    Rickie Houston is a wealth-building reporter for Business Insider, tasked with covering brokerage products, investment apps, online advisor services, cryptocurrency exchanges, and other wealth-building financial products. He is also a Certified Educator in Personal Finance (CEPF). Previously, Rickie worked as a personal finance writer at SmartAsset, focusing on retirement, investing, taxes, and banking topics. He's contributed to stories published in the Boston Globe, and his work has also been featured in Yahoo News. He graduated from Boston University, where he contributed as a staff writer and sports editor for Boston University News Service. Learn more about how Personal Finance Insider chooses, rates, and covers financial products and services »

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    Eric Rosenberg

    Freelance Writer

    Eric Rosenberg is a finance, travel, and technology writer in Ventura, California. He is a former bank manager and corporate finance and accounting professional who left his day job in 2016 to take his online side hustle full-time. He has in-depth experience writing about banking, credit cards, investing, and other financial topics, and is an avid travel hacker. When away from the keyboard, Eric enjoys exploring the world, flying small airplanes, discovering new craft beers, and spending time with his wife and little girls. You can connect with him at Personal Profitability or EricRosenberg.com.

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