The transition from college to the real world isn’t an easy one. In college, 100% of your mind was devoted strictly to three things: getting as hammered as possible, girls, and classes, usually in that order. What little money could be scraped together was used for the cheap as dirt rent and cases of natty ice, while your student ID card could be used for almost everything else (groceries, all meals, books, school supplies, etc). With the start of the real world came real responsibilities. Astonishingly, rent in a major city was more expensive than in the middle of nowhere. Food suddenly cost real currency. Drinks were no longer purchased in $10 cases; rather, they were served in bars offering $13 pitchers….really? Meanwhile, the whole prospect of hooking up with strangers in the real world was proven a lot more difficult than expected. Suddenly, you have to be “someone’s friend” or go to the right parties to even have a chance. Meanwhile, you wistfully watch as older adults party on their yachts with a bevy of girls and wonder, when will that be me? Will it be when I’m 65 and I just worked 45 years? Will I have to pay $150,000 for an MBA just to get a high paying job? The way to do it is to start investing on that first paycheck. Sure, 401k’s provide a steady stream of money and a nice base for retirement, but I’m not living my whole life in poverty just to celebrate in Del Boca Vista in 2062. But what online brokerages are the best out there for someone starting out? Since no one has the capital in their early twenties to pay out the ass in fees, choosing between online brokerages is extremely important. Sure, E*Trade has those hilarious talking babies, but is it actually a good brokerage? After the jump, ConsumerSearch recently performed a full review of thirteen of the top online brokerages, outlining pros and cons of each and including important tenants such as minimum investments and trade fees. Now start making some money before you’re too old and wrinkly to really enjoy it.
Fidelity:
Pros: Great Research Tools, full range of financial services, wide range of investment products, lower commissions than last year
Cons: Minimum Balance of $2,500
Commissions: $7.50 per trade. More than 1,600 no-load, no transaction fee mutual funds
Minimum to Open an Account: $2,500
TradeKing:
Pros: Low-cost trades, great customer services, no minimum deposit required, good research tools
Cons: Relatively narrow range of investment products, no in-person help
Commissions: $4.95 for any type of trade
Minimum to Open an Account: None
ThinkOrSwim:
Pros: Flat-rate commissions, great mobile access, three free mutual fund trades per month, cutting-edge trading technology
Cons: Not great for international traders, more bells and whistles than some might want, takes $3,500 to open an account
Commissions: $9.95 per trade, Options $0.95 to $2.95 per contract
Minimum to Open an Account: $3,500
TD Ameritrade:
Pros: excellent research and trading tools, above-average customer satisfaction, clear commission rates
Cons: More expensive than some, minimal banking services, fewer investment vehicles than some
Commissions: $9.99 per online trade up to 150 per quarter
Minimum to Open an Account: $2,000
Scottrade:
Pros: High customer satisfaction, lower transaction fee, more than 400 branch offices, $500 minimum opening balance
Cons: Not much research help, online tools fairly basic, relatively narrow range of investment products
Commissions: $7 per trade
Minimum to Open an Account: $500
Charles Schwab:
Pros: Easy-to-use website, broad range of investment offerings, customer service available 24/7, banking services
Cons: Higher Commissions, $1,000 minimum initial investment
Commissions: $8.95 per trade
Minimum to Open an Account: $1,000; waived if you open a linked checking account or establish a minimum monthly deposit of at least $100
Interactive Brokers:
Pros: Low trading costs, sophisticated trading tools, direct-access trading, access to more than 90 markets worldwide
Cons: $10,000 minimum to open most accounts, trading platform not user-friendly, best for professional traders, not average investors
Commissions: Estimated $0.005 per share, minimum $1 per trade; $10 minimum per month
Minimum to Open an Account: $10,000
E*Trade:
Pros: Good access to foreign markets, banking services, mobile apps, access to good research
Cons: Relatively high trading costs, account maintenance fee
Commissions: $9.99 per trade. Reduced commissions for those who make more than 150 trades per quarter.
Minimum to Open an Account: $500
OptionsXpress:
Pros: Cutting-edge trading technology, no account minimum, mobile apps, top-notch investor education
Cons: Limited banking services, high commissions than some
Commissions: $9.95 per online trade
Minimum to Open an Account: None
OptionsHouse:
Pros: Low Commissions, no account minimum, no account fees, mobile apps
Cons: Emphasis on options trading, trading technology not the best
Commissions: $3.95 per online trade; $9.95 for mutual funds
Minimum to Open an Account: None
Vanguard:
Pros: Good customer service, large selection of low-cost mutual funds, low costs for buy-and-hold investors
Cons: Higher costs for frequent traders, no mobile apps, minimum investment $3,000
Commissions: $7 per online trade for for the first 25 trades each calendar year; then $20 per trade
Minimum to Open an Account: $3,000
ShareBuilder:
Pros: Includes tutorials, primers, automatic investments costs $4, no minimum balance required
Cons: Market orders cost $9.95, fairly basic trading tools, narrow range of investment products, no banking services
Commissions: $4 automatic trades; $9.95 per trade for market orders
Minimum to Open an Account: None
Zecco:
Pros: No minimum-deposit requirement, no inactivity or maintenance fees, lower commissions per trade
Cons: Lower customer service scores, rudimentary research and trading tools, narrow range of offerings
Commissions: $4.50 per trade. 10 free trades per month if you have $25,000 in your account
Minimum to Open an Account: None
For more info, visit Consumer Search
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