There are dozens of different companies that offer brokerage accounts to people who want to start investing. Choosing a brokerage is an important part of starting to invest.
Each brokerage offers different types of accounts, features, and fees, so you want to choose one that fits with your needs.
For example, people who want to save for retirement want to work with a brokerage company that offers IRAs. People who are saving for a child’s education should find a brokerage that lets them invest in 529 plans.
How you plan to invest also affects the brokerage you choose. Some major brokerages like Fidelity, Schwab, and Vanguard have their own line of mutual funds and don’t charge commissions when investors purchase their funds. If you plan to invest mostly in mutual funds and exchange-traded funds (ETFs), using the brokerage that also manages those funds can be a good idea.
If you plan to invest primarily in individual stocks, finding a brokerage with its own line of mutual funds is less important. Instead, focus on avoiding costs like account fees and trade commissions so you don’t pay a huge amount to build your desired portfolio.
Pro tip: If you have several investment goals, consider opening an account with Acorns. With Acorns Invest, you’ll be able to invest your spare change in a diversified portfolio. You can also make recurring deposits on your schedule. If you want to invest for retirement, Acorns Later will help you set up an IRA account. Do you have kids? Acorns Early is an investment account for kids that can be opened in just 3 minutes.