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Bottom line: Fidelity automated investing and Charles Schwab automated investing both offer multiple options for investors in search of automated portfolio management, but Fidelity is the best choice for low-cost investments. Schwab, however, is a better option for investors in search of a wider range of account types and investing features.
Fidelity vs. Charles Schwab automated investing: The biggest differences
Fidelity and Charles Schwab each offer two different automated investing accounts for hands-off investors. Each brokerage allows you to invest through vehicles like individual brokerage accounts, joint accounts, and IRAs, but the fees, investment choices, and features vary per platform.
Fidelity is the better choice for investors in search of lower-cost securities. It uses the Fidelity Flex mutual funds for both of its automated accounts, and all of these funds are free of expense ratios (meaning you’ll only have to worry about advisory fees).
However, Schwab is the best option for low advisory fees and account type availability. Its standard automated investing account has zero advisory fees, and the brokerage’s managed portfolios are compatible with several different types of accounts.
Fidelity and Schwab’s fees and features also vary.
Fidelity Investments
Charles Schwab
Account types
Individual brokerage account, joint account, Traditional IRA, Roth IRA, rollover IRA, and health savings account (HSA)
Account types
Individual brokerage account, joint tenants with rights of survivorship, tenants in common, community property, custodial, trust, SIMPLE IRA, SEP IRA, traditional IRA, Roth IRA, inherited IRA, and rollover IRA
Investment choices
Fidelity Flex mutual funds
Investment choices
ETFs
Account perks
Zero-expense-ratio Fidelity Flex mutual funds, portfolio rebalancing, professional oversight, advisor guidance, 24/7 customer support
Account perks
No advisory fees for Schwab Intelligent Portfolios, professional oversight, automatic rebalancing, tax-loss harvesting, CFP guidance, 24/7 customer support
Human advisors available?
Yes — unlimited access to one-on-one financial coaching and professional investment management with Fidelity Personalized Planning and Advice; advisor access also
Human advisors available?
Yes — Unlimited one-on-one guidance from a CFP with Schwab Intelligent Portfolios Premium
Robo-advice?
Yes — Fidelity Go and Fidelity Personalized Planning and Advice
Robo-advice?
Yes — Schwab Intelligent Portfolios and Schwab Intelligent Portfolios Premium
Are Fidelity’s automated accounts right for you?
Pros
No minimum requirement for Fidelity Go; zero advisory fees for those with balances below $10,000Automated accounts are managed by a team of Fidelity professionalsBoth accounts utilize Fidelity Flex mutual funds, so you won’t have to worry about any expense ratios when paying advisory feesYou can take advantage of ongoing, one-one-one advisor support with Fidelity Personalized Planning & Advice
Cons
No tax-loss harvestingFidelity Personalized Planning & Advice is more expensive for investors with balances above $72,000Fewer compatible account types than Schwab
Fidelity automated investing offers two different automated accounts: Fidelity Go and Fidelity Personalized Planning & Advice. Both accounts best serve hands-off investors who want their investments managed for them, but Fidelity Personalized Planning & Advice is a better option if you’re looking for both automated portfolio management and human advisor support.
If you’re solely after low-cost automated portfolio management, Fidelity Go is the best choice. The account has a $0 minimum requirement (though you’ll need at least $10 to invest), and it invests your money in a combination of Fidelity Flex mutual funds that contain domestic stocks, bonds, foreign stocks, and other investments.
As for fees, the amount you pay depends on your account balance. For instance, you’ll pay $0 in advisory fees if you have an account balance under $10,000. Fidelity has a $3/month fee for investors with balances between $10,000 and $49,999. Those with $50,000 and above have to pay 0.35% per year.
Fidelity Personalized Planning & Advice, on the other hand, merges automated investing and advisor assistance. This account offers everything Fidelity Go does, but it also includes unlimited one-on-one calls with Fidelity financial advisors.
Though you’ll be responsible for a $25,000 minimum requirement and 0.50% annual fee, this account is great if you’re looking for professional advice on topics like retirement saving, establishing an emergency fund, reducing debt, and designing a financial plan.
Overall, both Fidelity Go and Fidelity Personalized Planning & Advice give you access to investment accounts managed by a team of Fidelity professionals and 24/7 customer support. The two accounts also allow you to adjust your risk tolerance and investing goals at any time, and Fidelity will automatically rebalance your portfolio to make sure it’s on track.
The best account for you depends on how much guidance you’re looking for.
Are Charles Schwab’s automated accounts right for you?
Pros
No advisory fees for Schwab Intelligent PortfoliosBoth of Schwab’s automated accounts include automatic rebalancing, professional oversight, and tax-loss harvestingSchwab Intelligent Portfolios Premium includes unlimited CFP guidanceAdvisory fee for Schwab Intelligent Portfolios Premium is a flat fee, meaning you won’t pay more or less (like you would with an asset-based fee) depending on your account balance
Cons
Minimum account size requirement for Schwab Intelligent Portfolios may be high for someBoth accounts utilize ETFs that have expense ratios/operating expenses
Like Fidelity, Charles Schwab automated investing automated accounts — Schwab Intelligent Portfolios and Schwab Intelligent Portfolios Premium — also include an automated-only account and an automated-plus-advice option. Plus, each account features automatic rebalancing, tax-loss harvesting, and professional oversight.
The automated-only account, Schwab Intelligent Portfolios, beats Fidelity when it comes to advisory fees (it has no advisory fees or commissions). But since the account has a $5,000 minimum requirement, Fidelity Go is a better choice for those with lower balances.
Schwab Intelligent Portfolios Premium combines all of the features of Schwab Intelligent Portfolios with unlimited one-on-one guidance from a certified financial planner (CFP). This account shares Fidelity Personalized Planning & Advice’s $25,000 minimum requirement, but its fee structure is quite different.
Instead of an annual asset-based fee, Schwab charges a $300 one-time planning fee, plus a $30/month advisory fee. Those with balances under $72,000 will comparatively pay less in advisory fees (excluding investment/fund fees) with Fidelity Personalized Planning & Advice. Schwab’s $30/month fee results in $360 per year, but if you subtract Fidelity’s 0.50% fee from $72,000, you’ll get the same $360 result.
So, in other words, the Fidelity account becomes more expensive than Schwab’s once your account balance passes $72,000.
As for its investment selection, both of Schwab’s automated accounts invest your assets in a diversified blend of low-cost ETFs. According to its website, Schwab builds personalized portfolios with more than 80 variations of investments. It offers more than 51 ETFs, three different investment strategies (Global, U.S. Focused, and Income Focused), and six different risk profiles. You can find more information about its underlying ETF fees here.
Finally, if platform navigability and customer support are important to you, you shouldn’t have any issues with either at Schwab. You can use either automated account with the brokerage’s web and mobile interfaces, and Schwab offers 24/7 live chat, phone support, and numerous physical branches.
Fidelity vs. Charles Schwab — Frequently asked questions (FAQ)
Is Fidelity better than Charles Schwab?
When it comes to automated investing, Fidelity offers less expensive investments. While Schwab uses funds that contain expense ratios in both of its automated accounts (Schwab Intelligent Portfolios and Schwab Intelligent Portfolios Premium), the Fidelity Flex mutual funds have no expense ratios.
However, Schwab is a better option for those with balances of $10,000 or more. You’ll only be able to skip out on advisory fees with the Fidelity Go automated account if you’ve got a balance under $10,000. Though Schwab Intelligent Portfolios has a higher minimum requirement ($5,000), its lack of advisory fees is constant for all balances.
How much money do you need to open a Charles Schwab account?
Schwab’s brokerage accounts, IRAs, trusts, custodial accounts, and education savings accounts don’t have minimum requirements. Minimums mainly apply to its automated offerings. Schwab Intelligent Portfolios has a $5,000 minimum, and Schwab Intelligent Portfolios Premium requires $25,000.
Can you lose money with Fidelity?
Yes. You can lose money or you can make money depending on factors including (but not limited to) market volatility, economic conditions, and frequency of contributions. But this is the case for any brokerage or investment platform.