Best online stock brokers for beginners in September 2021

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You’ve decided it’s time to take the plunge to get a brokerage account. But the task probably sounds a bit daunting, especially after the intense fluctuations in the stock market during the COVID-19 crisis. But it can actually be quite easy to get started — and many brokers are investor-friendly, especially for beginners.

While options abound, you probably want a brokerage that includes accessible educational resources, an easy-to-navigate app and website, zero commissions, low fees and attainable minimums — all attractive qualities if you’re getting started. Here are several options to consider.

The best online stock brokers for beginners:

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Overview: Top online brokers for beginners in September 2021

TD Ameritrade

TD Ameritrade is good for beginners because of all of the information it makes available to guide you into the world of investments. New investors can take advantage of all kinds of educational material, including more than 200 instructional videos, tutorials and more.

TD Ameritrade also makes it easy to ask investment questions without worrying about whether you’re getting judged for asking something “too basic.” You can also interact with the brand on apps you already use, like Facebook Messenger and Amazon Alexa devices.

Two mobile trading apps, TD Ameritrade Mobile and TD Ameritrade Mobile Trader, give you trading access and much more wherever you are.

(Charles Schwab has purchased TD Ameritrade, and will eventually integrate the two companies.)

  • Cost per stock/ETF trade: $0
  • Minimum balance to open an account: $0

E-Trade Financial

E-Trade is considered by many as the online brokerage pioneer, but it’s kept up with the times, too, offering two mobile apps. On the E-Trade mobile app, you can move money using mobile check deposit in addition to other features, such as tracking the market or trading stocks and ETFs. Its other mobile app is called Power E-Trade, and allows you to enter orders, including complex options trades, on a single ticket. You’ll also get streaming news, quotes and a customizable options chain.

Importantly, E-Trade is great for beginners because it also offers all kinds of content to help you understand what you’re doing — videos, articles and live education sessions included.

  • Cost per stock/ETF trade: $0
  • Minimum balance to open an account: $0

Ally Invest

Ally Invest is a newer entrant to the brokerage space, launching a few years ago after purchasing TradeKing. Ally is a solid offering for those who already do business with Ally Bank and would like an easy way to expand their relationship into investing.

You can also access your account on Ally’s mobile app to get quotes and make trades. The direct bank is also widely recognized for its excellent customer service and its progressive digital banking features, and you can quickly move cash from your bank account to your investment account.

It also offers a resource center with helpful content written in a more enjoyable way than most — think headlines like “What mutual funds and pizza have in common,” for instance.

  • Cost per stock/ETF trade: $0
  • Minimum balance to open an account: $0

Merrill Edge

With no minimum investment, Bank of America’s Merrill Edge is another good option for beginning investors — particularly if you’re a Bank of America bank customer. As one of the bank’s customers, you’ll have immediate access to cash transfers to your brokerage account, and you’ll be able to access a Merrill advisor at more than 2,000 Bank of America locations.

Merrill Edge’s integrated mobile experience lets you make credit card payments and place trades — assuming you’re a bank customer and investor.

Merrill Edge also provides ample research to help you make trading decisions and a wealth of educational materials can help you get up to speed on investing.

  • Cost per stock/ETF trade: $0
  • Minimum balance to open an account: $0

Robinhood

Robinhood is the poster child for fintech disruptors, and subscriber growth has been meteoric, especially when it was among the only brokers offering free trades. This mobile-first broker made phone-based trading its standard, and its app retains that easy functionality.

If you’re just getting started, Robinhood will give you immediate access of up to $1,000 when you make a deposit, so you can start trading immediately. While the app’s basic functionality does not include much research or educational material, you can opt for Robinhood Gold (at $5 per month) and receive Morningstar reports on 1,700 companies as well as margin trading.

  • Cost per stock/ETF trade: $0
  • Minimum balance to open an account: $0

Charles Schwab

Charles Schwab is the original discount broker and it’s made the leap to online broker with ease. Schwab is as investor-friendly as they come, and offers a full range of features, which will help you as you make your way from novice to confident investor.

Schwab offers stock reports, Morningstar reports and news from Reuters, while the broker’s ETF screener will help you search for a winning fund. Schwab also provides great educational materials for beginners, so you’ll be able to learn all the fundamentals of good investing.

A fully featured mobile app allows you to do virtually all you can do on the desktop platform. Also a nice feature for beginners: you can receive up to a $1,000 bonus with a qualifying deposit and a referral code from a friend.

  • Cost per stock/ETF trade: $0
  • Minimum balance to open an account: $0

Fidelity Investments

Fidelity may be the most investor-friendly broker out there, making it a great choice for beginners. This broker offers it all and does it at a high level, with remarkable customer service, too, especially by phone, where you can get an answer to your detailed question in seconds.

The research resources here are deep, with a variety of reports available. You’ll get all the basics on how to invest smartly and so much more. You can attend webinars or view recorded ones that cover almost any area of investing, so you’ll be knowledgeable in no time.

Fidelity’s site is easy to navigate, and you’ll find what you’re looking for quickly without much fuss.

  • Cost per stock/ETF trade: $0
  • Minimum balance to open an account: $0

Other options: Top robo-advisors

If getting started is still too daunting and you want a low-cost option that manages a portfolio of investments for you, then a robo-advisor is a great option. A robo-advisor will create a portfolio based on your risk tolerance and time horizon, and you’ll pay a low fee based on how much you have in the account. And it still takes only a few minutes to get started.

Two of the largest independent robo-advisors are Betterment and Wealthfront.

How brokerage accounts work

Brokerage accounts allow you to purchase securities such as stocks, bonds and ETFs and are a great way to save toward your financial goals. A brokerage account might be used to save and invest for a specific financial goal such as paying for a child’s education, or it may just be used to build wealth over time. Brokerage accounts also typically come with a number of additional features such as access to research reports and other tools.

Unlike retirement accounts, you’ll be able to access your money at any time in a brokerage account, but will likely owe taxes on any gains on your investments, depending on your income.

Do you need a lot of money to use a broker?

The great news for investors these days: It’s never been cheaper and easier to get started investing. In fact, lower fees have made online brokerages more investor-friendly than ever. So you won’t need a lot of money to get started on your investing journey.

Virtually every major online brokerage allows you to get started with no account minimum, so you can start off with $5 or $500. It’s also easy to find a broker that offers no-commission trading of stocks and ETFs (and sometimes options), so you won’t rack up fees when buying or selling. With no commission, you can invest tiny amounts and have it all go into your securities.

About the only routine fee that brokers consistently charge is a “transfer-out fee” if you want to move securities to another account. And you’ll only pay that if you do make a transfer of securities, but you won’t pay for any cash transfers.

For these reasons it’s never been cheaper for investors to get started investing in the market.

Is my money safe in a brokerage account?

You may be familiar with the Federal Deposit Insurance Corporation, or FDIC, and that it protects deposits held in FDIC-insured banks in the event a bank fails.

A similar protection exists for brokerage accounts through the Securities Investor Protection Corporation, or SIPC, a nonprofit membership organization that was created in 1970 by federal law. The SIPC protects customers of SIPC-member brokers in the event that the firm fails. Customers are covered for up to $500,000 for all accounts at one institution, including a maximum of $250,000 for uninvested cash.

It’s important to note that the SIPC does not protect you from investment losses, but rather only if your brokerage firm fails financially. So don’t expect a bailout if you see the value of your stocks or bonds decline.

How to withdraw money from a stock broker

Yes, unlike retirement accounts such as 401(k)s or IRAs, brokerage accounts don’t have age limits on withdrawing your money. You’ll be able to access your money in a brokerage account whenever you’d like, but there are a few steps to the process.

First, you’ll need to sell any investments in order to have cash in your account if you didn’t have uninvested cash already. Then you’ll need to transfer the cash to your bank account, which typically takes a couple of days. If you know the day you’ll need the money, it’s best to plan ahead and start the process a few days early. You could also request a physical check from your broker, but that would likely increase the time it takes to get the money in your hands. Keep in mind that money you need soon shouldn’t be invested in long-term assets such as stocks in the first place.

What’s the difference between a discount brokerage and a full-service brokerage?

Discount brokers are increasingly online brokers that offer investors the opportunity to buy and sell securities at little or no cost. A full-service broker also allows clients to trade securities, but will also offer advice on which securities to buy and may act as more of a financial advisor. This increased level of service and attention typically comes with a higher cost, either in the form of commissions on trades or an annual fee. You may need a larger amount of money to attract attention from a full-service broker, whereas discount brokers typically have no account minimum.

Discount brokers tend to be the cheaper option, but you will need to take a more hands-on approach to your investments because you’ll be the main person overseeing them.

What other resources do you need?

While cost is an important factor in choosing a brokerage, you’ll also want to consider other traits that may improve your experience, such as:

  • Research: How much research does the broker offer? Is it in-house work or from third parties? Do you need research on individual stocks or are you looking for funds?
  • Education: Many brokers offer a ton of educational resources so you can understand how to invest effectively. Quite a few brokers offer articles and webinars on how to use their advanced products and tools, especially if you’re looking to trade more often.
  • Trading simulators: Some brokers offer trading simulators that give you a wad of virtual money and let you use the simulator to try out their platform and test your skills.
  • Customer support: If you’re just starting out, you may have a lot of questions, so good customer support can be vital. Check a broker’s availability and see if it matches up with your needs.
  • Mobile apps: If you’re looking to trade via mobile, you may want to take a peek at the broker’s app first. While some brokers are mobile-first and known for the quality of their app, almost all major online brokers offer an app that can get the job done.

Those are some of the major features that you’ll want to consider, but you may have other “must-have” features depending on your needs.

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Note: Bankrate’s Brian Baker also contributed to this story.