Choosing an Online Broker

I spent some time researching online brokerage services to park our stocks, retirement and education accounts. I was initially planning to go with Vanguard because I appreciate their reputation and investor/owner structure. But I balked at their fees and decided to do a real comparison. There are many more contenders then I expected; here’s an overview of what I gathered from their websites. These companies are all considered discount brokers and hence, I didn’t even consider Vanguard in the end.

1. No minimun opening balance if you set up an automatic monthly transfer of at least $100.
2. No annual fee if balance is greater than $25,000.
3. This is the standard rate; cheaper for high balance accounts.
4. Plus $.015 for each share over 1,000.
5. Plus $.015 for each share over 2,000.
6. No minimun opening balance if you set up an automatic monthly transfer of at least $200.
7. Minimum opening balance is $15 if you set up automatic monthly transfer.
8. Must agree to online delivery of statements and transaction confirmations; $25 annual fee applies otherwise.
9. Minimum opening balance is $500 for electronically funded accounts; no minimum for accounts funded otherwise.

So, that information is nice but lacks the subjective view of service and quality. A quick google search got me a couple of comparisons from The Motley Fool and SmartMoney and a nice overview of all the major players.

So, based on that few hours of research, I’m dumping Vanguard and going with Scottrade. They’re cheap, have the account types I need, some decent resources, and are relatively well-known and respected. Done and done.