Charles Schwab bank review December 2023

Charles Schwab

Blueprint Rating

Products

Checking, savings, credit cards, investing, retirement, annuities, trusts, wealth advisory

Fees

$25 per outgoing wire transfer; $15 if transferred online

ATM network size

None, but you get unlimited ATM fee rebates

What you should know

In addition to its brokerage platform and retirement offerings, Schwab offers basic banking services like online checking and savings accounts with no minimums and few fees. There are branch offices in seven states (mostly in California), but you’ll need to manage your bank accounts entirely online.

Pros

• Competitive CD yields.
• Low fees.
• Unlimited rebates on ATM fees for cash withdrawals worldwide.

Cons

• No in-person help for checking and savings accounts.
• Savings and checking accounts don’t offer stellar yields.
• To open a checking account, you must also open a brokerage account.

Charles Schwab basics

• Checking accounts: Schwab Bank Investor Checking™.
• Savings accounts: Schwab Bank Investor Savings™.
• Certificate of deposit (CD): Charles Schwab Certificates of Deposit.
• Other Accounts: Investing, credit cards, IRAs, 529 accounts.
• Bank branches or online only: Banking services are online-only.

About Charles Schwab

Charles Schwab became famous as a discount brokerage company and has grown over the years to offer banking services as well. 

As it’s a chartered bank, you can have peace of mind knowing that deposits here are insured by the Federal Deposit Insurance Corp. (FDIC) for up to $250,000 per depositor, per account ownership type (think joint vs. individual account).

Note that banking services are only available digitally. While there’s no way to deposit cash into the account directly, you can set up:

• Direct deposit.
• Mobile check deposit.
• Transfers from a Charles Schwab brokerage account.
• Online or wire transfers from another bank account.
• Check mailed to Schwab Bank.

Account details and annual percentage yields (APYs) are accurate as of November 28, 2023. 

Schwab Bank Investor Checking

To open this account, you must open a Schwab One® Brokerage account, too. Linked, neither have minimum opening deposits, monthly service fees or overdraft fees. (On overdrafts, however, note that Schwab Bank may deny a transaction if you don’t have enough funds in a linked backup account to cover the amount.) 

You can earn an annual percentage yield (APY) of 0.45% on your funds while they’re in your checking account, which is a middle-of-the-road rate — it’s considerably higher than the national average, which is 0.07% APY as of November 20, 2023 according to the FDIC, but the best interest checking accounts offer at least 3.00% APY.

To withdraw money, you can use free checks and a Visa debit card. There are no foreign transaction fees and, spectacularly, it features unlimited ATM fee reimbursements, both domestically and abroad.

Schwab Bank Investor Savings

Like the checking account, you won’t need a minimum opening deposit and there are no monthly maintenance fees here. Perhaps the biggest drawback is that the yield is rather skimpy, at 0.48% APY, which is well below the best high-yield saving rates.

But the account does come with some perks. You can get a debit card for it if you don’t open a Charles Schwab checking account, which is an option that many other savings accounts don’t offer. Plus, like its sister checking account, it offers unlimited ATM fee rebates worldwide.

Charles Schwab Certificates of Deposit

You can find Schwab CDs with terms from one to 18 months through Schwab CD OneSource. As a broker, Schwab doesn’t issue the certificates itself, but, rather, allows you to buy and sell CDs that are issued by other financial institutions.

Current rates range between 5.47% APY and up to 5.55% APY.

Those are competitive, but here are the best CD rates on the market if you want to do some comparison shopping or if you’re after longer terms.

Other products

• Brokerage accounts: We named Schwab as one of the best online brokerages. It offers $0 trade or commission fees for online-listed stocks, ETFs, mutual funds and more; has no account minimum requirement and no maintenance fees.  
• Investment advisory services: You can find automated investment portfolios (often called “robo advisors”), wealth advisory services, charitable giving accounts and actively managed accounts.
• Retirement: Schwab offers Traditional, Roth, Rollover, Inherited and Custodial IRAs, as well as Small Business Solutions, including 401(k)s.
• Education savings: The Schwab 529 Education Savings Plan, an Education Savings Account and a Custodial Account are available.
• Credit cards: The Schwab Investor Card® from American Express * The information for the Schwab Investor Card® from American Express has been collected independently by Blueprint. The card details on this page have not been reviewed or provided by the card issuer. (terms apply) comes with no annual fee and 1.5% cash back on eligible purchases. The Platinum Card® from American Express for Charles Schwab * The information for the The Platinum Card® from American Express for Charles Schwab has been collected independently by Blueprint. The card details on this page have not been reviewed or provided by the card issuer. (terms apply) pays 5 Membership Rewards points per $1 for flights booked directly with airlines or with American Express Travel (on up to $500,000 per calendar year), 5 points per $1 on eligible prepaid hotels booked with American Express Travel and 1 point per $1 spent on other eligible purchases, and comes with a $695 annual fee.
• Annuities, trusts and estate services: Variable, fixed and deferred annuities are featured in addition to trust accounts, estate accounts and estate services. 
• Loans: Charles Schwab doesn’t directly fund mortgages or home refinancing, but it can help you get one through a partnership with Rocket. The brokerage provides interest rate discounts if you have at least $250,000 in assets cross eligible Schwab bank and brokerage accounts.  
• Insurance: Schwab makes life insurance, disability insurance and long-term care insurance available. 

How Charles Schwab stacks up

Charles Schwab vs. Vanguard

Besides providing an investment platform, Vanguard offers money market funds, brokered CDs and the Vanguard Cash Plus Account. The latter resembles a traditional savings account: It allows you to deposit and withdraw funds easily and comes with FDIC insurance of up to $1.25 million for individuals. You can use the account to do things like pay bills, accept direct deposit payments from your employer and connect to payment apps like PayPal and Venmo. But these accounts don’t pay interest and are more restrictive compared to Schwab’s checking and savings accounts, since you must be an existing Vanguard customer to apply for the Vanguard Cash Plus Account. 

Charles Schwab vs. Fidelity

The Fidelity Cash Management Account is a brokerage account that can also function like a checking and savings account. You can withdraw money using checks and a linked debit card, and you get $1.25 million in FDIC insurance on your cash balance. There are no account fees or account minimums, and ATM fees are reimbursed both domestically and abroad. The account also offers a rate of 2.72% APY. 

Overall, Fidelity’s Cash Management Account is a good alternative for a checking account, but it’s no substitute for a savings account.