I was pretty annoyed when I received notice at work that I had to shut all investment accounts that were not with very specific broker dealers.  The list did not include my largely ignored account with Tradeking nor my favorite account, Sharebuilder which houses my Perpetual Income Machine.  As a reminder for everyone, I work in the financial services industry so there is literally nothing I can do short of quitting, and that isn’t happening. The reasons for the change in policy are not relevant for the purposes of this post it is what it is.  The purpose of this post is to list my broker options and my eventual decision.

I am allowed to transfer all my accounts to:

  • Charles Schwab
  • E-Trade
  • Fidelity
  • Merrill Lynch
  • Morgan Stanley
  • Scottrade
  • TD Ameritrade
  • T.Rowe.Price
  • UBS
  • Wachovia

We can eliminate a few of the options as they do not have an online discount broker and I am not looking to hire an advisor/pay for an advisor.

  • Charles Schwab
  • E-Trade
  • Fidelity
  • Merrill Lynch
  • Morgan Stanley
  • Scottrade
  • TD Ameritrade
  • T.Rowe.Price
  • UBS
  • Wachovia

This leaves us with 6 choices.

Choosing my Online Broker

The reason I loved ShareBuilder was the 12 automatic trades I received per month for $12 – it was perfect for my 6 holdings (2 automatic purchases per month), however, it seems that set up is not anywhere to be found in the remaining choices.  So the first thing I am looking for are the freebies associated with each online broker and their price per trade, and the second thing will be taking suggestions from my readers.

Free Investment Options With Online Brokers and Prices

Charles Schwab

You can invest in Schwab ETFs and One Source Funds for free (looks like there are 12 or so).  Otherwise price per trade is $8.95/trade.

E-Trade

If you perform less than 150 trades per quarter the price is $9.99/trade very high in my opinion.  They also have 1,100 no load mutual funds.

Fidelity

Fidelity trades are $7.95/trade, offer 30 Free ETFs to choose from and over 1,400 no-load mutual funds.

ScotTrade

ScotTrade has $7 trades, a handful of free ETFs, and no-load Mutual Funds.

TD AmeriTrade

TD Ameritrade has $10 trades but has over 100 ETFs that are commission free.  A lot of these ETFs are even in the Vanguard world which from what I read online means lower fees, but I have never really researched the topic.

T.Rowe.Price

I had to dig around but it seems that if I don’t complete 30 trades per year (most likely will, but no guarantees) it will cost me $19.95/trade.  The Wife has her Roth IRA with them through no-load mutual funds, but since I may be investing in individual stocks there is no way this can be a contender.

My Problem with the Online Broker Choices

My huge problem with the choices that I have is that I was paying next to nothing for 12 trades per month, the cost averaged out to a $1/trade.  I am not sure I can justify the continuance of my dividend fund at the current rate of $150-$300/month.  I will be getting killed in fees…especially at $10/trade! I would have $120 in fees to cover $150 in equity trades lol.  Alternatively, I am thinking I can build an income portfolio from commission free ETFs and No-Load Funds.

Generally, I am the kind of person who painstakingly analyzes the choices, and I could really use some help.

 

Readers: I really could use some help with this decision…anyone?  Who does everyone use? Do you buy individual stocks? If so, do you DCA or just purchase large lots?