Consolidating Cash Assets to a Single Brokerage - Fidelity or Schwab?

[Dash man]

Are there local independent offices with a Schwab “shingle”? I assumed all offices were company owned.

NM. Found this on a quick search.

“Schwab Independent Branch Leaders (IBLs) are franchisees who operate Schwab Independent Branches pursuant to a franchise agreement with Schwab.”

In my state the Independents are in smaller towns.

They have relationships with financial advisors around the country. They have them on their website if you want to search for them.

 

[a60dan]

The only reason I have anything with Fidelity is that they offer HSA accounts, which neither Vanguard nor Schwab offer.

Between the 2, I like Schwab for the income projections and the phone support when needed.

 

[hmango]

I have been using Schwab for over 30 years and also have an account with Fidelity. I really like the customer service with Schwab. A couple of the features that work especially well are their Donor Advised Fund and international banking (i.e., being able to do international transfers). I only use Fidelity for their HSA and some company stock (this is just because my company uses Fidelity for there stock ownership program).

 

[ShokWaveRider]

I opened our Schwab account at the corporate office in Jacksonville, Florida. It was pretty seamless, I funded it with 2 checks. Immediately moved it to their SNAXX Money Market where I will get 2.34%, it has been steadily rising.

I did talk to an "Independent" Schwab office about 5 miles from my home when. I chose the corporate office.

What tipped me over to corporate and a 40-mile extra drive to talk to someone in person? Simple: When I asked that if I already had a corporate account, and gave them a check to deposit, would they do it for me? They said Yes, but that they did not get credit for it, so they do it as a courtesy. There was that $2,500 incentive also of course that was skirted around by the Independent.

I was really not comfortable putting 1/3 of our cash assets with them and felt it was worth the drive to deal with a corporate office. After all, other than giving them checks and one on one meetings, one never has to go there as their web platform is perfectly adequate.

 

[jazz4cash]

Is there some reason the mobil check deposit wont work? I don’t get many checks these days and they are small amounts. DW has refused to use mobil check deposit so far.

 

[ShokWaveRider]

Is there some reason the mobil check deposit wont work? I don’t get many checks these days and they are small amounts. DW has refused to use mobil check deposit so far.

If you are talking about the "Mobile" App on Cell Phones, I do not have any financial info on my phone and never will have. however, my friend uses it, and deposits checks that way. Just not my thing.

 

[COcheesehead]

Is there some reason the mobil check deposit wont work? I don’t get many checks these days and they are small amounts. DW has refused to use mobil check deposit so far.

I’ve been using the mobile check deposit at Fidelity for years, even for 6 figure amounts. There is always a photo confirmation and the check is in your account within hours. Never had a problem. It’s easy and nothing to be afraid off.
Course there are folks who won’t use the tap technology for credit cards either.

 

[Montecfo]

If you are talking about the "Mobile" App on Cell Phones, I do not have any financial info on my phone and never will have. however, my friend uses it, and deposits checks that way. Just not my thing.

There are ACH transfers and banking by mail. These work.

 

[COcheesehead]

Bank by mail? Now that seems scary. No confirmation, no tracking.

 

[ShokWaveRider]

There are ACH transfers and banking by mail. These work.

I use ACH transfer all the time. I prefer them to other methods. Credit Unions limit them to $5k out per day, so one may have to do it a few times. Or Wire as it is free with our Credit Union.

 

[OldShooter]

They have relationships with financial advisors around the country. They have them on their website if you want to search for them.

I had never heard of this "Independent Branch" (IB) idea. A little research, though, shows that it is not at all the same as the more typical advisor relationship where Schwab serves as back office/custodian.

I am a strong believer in the idea that my relationship is with a person, not just a company. As I understand the Independent Branch story, it is a business relationship offered to individuals in geographic areas where Schwab doesn't want to set up a full-boat office. Almost by definition these will be small offices with maybe one or two advisors. So one question is whether the IB advisor is well-matched to the client. Another, more important to me, is whether the deeper bench of a full-boat office is available in the event the IB advisor doesn't work out or departs. Because of that latter question, I would be strongly inclined to stick sign with a full Schwab office.

This IB idea is a little over 10 years old: https://www.kitces.com/blog/schwab-...n-local-branches-looks-like-good-opportunity/ Quite a surprise to me! But it looks like an interesting way to attack Fast Eddie and others of that ilk. Google tells me that there are around 70 IBs versus 360 total Schwab offices.

 

[FANOFJESUS]

Both Fidelity and Schwab are great. I like Fidelity better for checking because they can sell money market funds to cover bills. In Schwab it must come from the core.

 

[OldShooter]

Both Fidelity and Schwab are great. I like Fidelity better for checking because they can sell money market funds to cover bills. In Schwab it must come from the core.

Not sure what you mean here by "core." My Schwab checking will cover overdrafts from cash or MMF in my regular cash brokerage account. What it will not do is to get cash by selling what Schwab calls "Purchased Money Funds."

That said, I use SWVXX Purchased Money Fund instead of Schwab's cash sweep, because the sweep goes into Schwab Bank at a pathetic rate of interest. This is one of the little revenue improvement nibbles that they instituted after transaction fee income went away.

 

[FANOFJESUS]

Not sure what you mean here by "core." My Schwab checking will cover overdrafts from cash or MMF in my regular cash brokerage account. What it will not do is to get cash by selling what Schwab calls "Purchased Money Funds."

That said, I use SWVXX Purchased Money Fund instead of Schwab's cash sweep, because the sweep goes into Schwab Bank at a pathetic rate of interest. This is one of the little revenue improvement nibbles that they instituted after transaction fee income went away.

I guess I should have called it cash sweep but I am not a Schwab customer so I don't know all the terms.

 

[OldShooter]

I guess I should have called it cash sweep but I am not a Schwab customer so I don't know all the terms.

No problem. I thought that was what you meant. So Schwab has the same feature but with a pathetic interest rate. Google tells me it's 28bps at Schwab Bank. Google gives me 1.19% for Fido's sweep account. Much better deal for anyone who holds a bunch of cash there.

 

[ShokWaveRider]

No problem. I thought that was what you meant. So Schwab has the same feature but with a pathetic interest rate. Google tells me it's 28bps at Schwab Bank. Google gives me 1.19% for Fido's sweep account. Much better deal for anyone who holds a bunch of cash there.

Schwab makes it easy to move the money to a higher rate MM, I plan to just go back and forth as needed. But I think I will leave it in SNAXX for a while, at least till the end of the year.

 

[OldShooter]

Schwab makes it easy to move the money to a higher rate MM, I plan to just go back and forth as needed. ...

Yup. That's what I do too, but money in the "Purchased MMF" funds is not available to cover checking account overdrafts. So I will still acknowledge the Fido system as being better.

 

[ShokWaveRider]

Yup. That's what I do too, but money in the "Purchased MMF" funds is not available to cover checking account overdrafts. So I will still acknowledge the Fido system as being better.

We use our local CU for checking, so we just ACH over as we need it. honestly we have never needed overdraft protection for the last 50 years, I cannot see that changing.

 

[UnrealizedPotential]

I like Schwab. They are always helpful on the phone or online and I like their ATM card that reimburses fees that other ATM's charge you to get cash out.

 

[davidfin]

Use both. Fidelity has better web tools. Like Full View.

 

[Spanky]

We have accounts with Vanguard, Dido and Schwab. They are all fine.

 

[FANOFJESUS]

Yup. That's what I do too, but money in the "Purchased MMF" funds is not available to cover checking account overdrafts. So I will still acknowledge the Fido system as being better.

AT fidelity they sell Purchased MMF when your core is empty. So you end up with a checking account paying about 2%

 

[OldShooter]

AT fidelity they sell Purchased MMF when your core is empty. So you end up with a checking account paying about 2%

Definitely one aspect of the customer relationship where Fido is ahead of Schwab.

 

[target2019]

Schwab does not have a default money market fund for the sweep in your brokerage.
https://www.schwab.com/cash-investments

It is annoying. You will need to use SWVXX or similar, and buy/sell that position. Another option is to move money in and out through one of the higher-yielding options (like Ally, Discover, etc.).

With Schwab Checking we do similar.

 

[PaunchyPirate]

Reviving this thread after a bit of dormancy.

I believe I've made up my mind to leave Vanguard, probably after the first of the year. But I have a couple preparation steps I can do this year. I'm researching both Schwab and Fidelity as many do.

If I'm successful in getting a bonus from either of them to switch my accounts over, is that bonus considered taxable income? Will they send me a tax form to use with my taxes? Since I manipulate my income for ACA purposes, I want to know how much it could impact my income for the year.

Also, does anyone know if the $2500 bonus amount mentioned in this thread is still around? I'd be moving 7 figures over 3 accounts if I transfer it all.