Charles Schwab Bank Review: Fee-Free Accounts With No Foreign Transaction Fees
GOBankingRates Score
Charles Schwab Bank
-
Checking Accounts
5.0
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Savings Accounts
4.0
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CD Accounts
5.0
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Banking Experience
4.5
Pros
- No-fee checking and savings accounts
- Unlimited global ATM fee rebates
- No foreign transaction fees
- No account minimums
Cons
- Limited account lineup
- Low APY compared with many other banks
Charles Schwab Bank Overview
Charles Schwab Bank is owned by Charles Schwab Corp., a multinational financial services company best known for its investment services. Its roots date to 1963, when three partners launched an investment advisory newsletter. Eight years later they formed a broker-dealer, but the firm didn’t take the Schwab name until 1973. Since then, Charles Schwab has emerged as one of the low-cost leaders in the brokerage industry, ultimately offering the first commission-free exchange-traded funds in 2009.
Charles Schwab Bank launched in 2003 as a division of the parent company. Bank offerings are designed to be tied in with Charles Schwab investment accounts and thus aren’t quite as extensive as those available at more traditional banks. GOBankingRates has ranked Charles Schwab Bank as having one of the Best Checking Accounts of 2023.
Key Features
Charles Schwab Bank has several features to offer account holders.
Checking Accounts
Charles Schwab Bank offers a single checking account that’s designed to facilitate the transfer of funds between the checking account and a Schwab brokerage account. There’s no monthly service fee or minimum balance with the Schwab Bank Investor Checking account. There are also no foreign transaction fees and customers are reimbursed for ATM fees worldwide.
This is an interest-bearing account that pays an APY of . Customers get a contactless debit card, mobile wallet and account access through the mobile app. GOBankingRates has ranked the Schwab Bank Investor Checking account as one of the Best Checking Accounts of 2023.
Savings Accounts
Charles Schwab Bank has a single savings account: Schwab Bank Investor Savings. Like the checking account, this savings account has no monthly service fee or account minimum. The APY is higher than many standard bank savings accounts but lower than most high-yield accounts.
Customers get a contactless debit card, mobile wallet and mobile app. Charles Schwab also offers remote check deposits and unlimited ATM fee reimbursement worldwide.
CD Accounts
Charles Schwab offers CDs through its brokerage division rather than Charles Schwab Bank. These brokered CDs are not held in a brokerage account. Instead, the account stays with the original bank that issued them. CD terms at Charles Schwab are available from 1 to 18 months with an APY as high as . All CDs come with FDIC insurance through the banks that offer them.
Banking Experience
Charles Schwab Bank may not have physical branches for customers to visit, but its customer service is top-notch. It earned the highest rating from J.D. Power and Associates for overall satisfaction among checking providers.
The mobile app can be used to view balances, buy and sell investment products, deposit checks and more. Ratings for the mobile app are varied, with an average rating of 3.7 out of five on Google Play and 4.8 out of five on the App Store. However, banking and investment customers use the same app, and most reviews seem to be from investment customers.
Comparable Online Bank Options
Before deciding on a bank, it’s always a good idea to see how it stands up against the competition.
Ally Bank
Ally Bank offers a no-fee savings account that pays an APY of up to , much higher than the APY available on the Charles Schwab Bank savings account. The online bank also gives customers tools like buckets to help them set and track savings goals. But Charles Schwab Bank has the edge for its checking account. Ally’s Interest Checking account has an APY of only and limits ATM reimbursements to $10 per month.
Chase
Chase has an edge over Charles Schwab Bank when it comes to branches and products. The bank has with more than 4,700 branches located nationwide. Customers can choose from a variety of different checking accounts and savings accounts. However, Chase accounts come with a monthly service fee that in most cases can be waived. Charles Schwab Bank’s unlimited global ATM fee reimbursement and lack of foreign transaction fees make it a better choice for travelers.
Final Take
Charles Schwab Bank is not the one-stop-shop many customers look for in a financial institution. Without opening an account with Schwab’s brokerage division, your accounts there are limited to one checking account and one savings account.
However, those accounts can be very useful for a certain type of customer, and it is best for those who travel abroad. The Schwab debit card has no foreign transaction fees, and ATM fees are reimbursed around the globe with no limit. Those perks, plus fee-free checking and savings accounts, make Charles Schwab Bank an enticing choice.
Brokerage customers at Charles Schwab can also benefit from having linked checking and savings accounts, which makes transfers faster and easier. The bottom line is that fees are nearly nonexistent with Charles Schwab Bank accounts, and there are numerous benefits attached to opening them.
Charles Schwab Bank FAQ
Here are the answers to some commonly asked questions about Charles Schwab Bank.- Does Charles Schwab have ATMs?
- Charles Schwab Bank doesn't have its own network of ATMs, but it does offer free unlimited ATM access at any ATM in the world.
- Can I use Zelle with Charles Schwab?
- Yes, Charles Schwab lets customers send and receive money with Zelle.
- Is Charles Schwab trustworthy?
- Charles Schwab has been in business for nearly 50 years. For the last four years, it has earned the highest score for customer satisfaction in J.D. Power and Associates' annual ranking of financial institutions. It also has a rating of A+ from the Better Business Bureau.
- Is Charles Schwab good for beginners?
- Charles Schwab's award-winning customer service gives beginners plenty of support. Representatives are available via phone, live chat and at local branches. Customers also have access to the online library featuring FAQs.
- Is Vanguard or Charles Schwab better?
- Vanguard does not offer checking, savings or CD accounts like you can get at Charles Schwab. Like Schwab, Vanguard has robo-advising and advisor-directed services for investment customers. If you're looking for more than an investment account, Charles Schwab may be a better fit.
- Does Charles Schwab have high fees?
- Schwab's checking and savings accounts have no fees or minimum balance requirements. Customers don't pay a foreign transaction fee when they use their debit card abroad, and they receive reimbursement for any ATM fees incurred.
Vance Cariaga and Allison Hache contributed to the reporting for this article.
Editorial Note: This content is not provided by any entity covered in this article. Any opinions, analyses, reviews, ratings or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by any entity named in this article.
Rates are subject to change; unless otherwise noted, rates are updated periodically. All other information on accounts is accurate as of Jan. 2, 2023.Â
To determine rankings for the Best Checking Accounts, GOBankingRates looked at the following factors from all banks (excluding credit unions): (1) total assets as sourced from the FDIC; (2) number of branch locations as sourced from the FDIC; (3) minimum deposit to open an account; (4) monthly checking fee ratio (percentage based on the minimum to avoid the fee compared to the monthly fee itself); (5) APY on the checking account; (6) overdraft fee amount; and (7) the average mobile app rating between the Android and Apple app stores. All factors were then scored and combined, with the lowest score being best. Factors (1), (2 and (5) were weighted 0.5 times, and factor (4) was weighted 1.5 times.Â
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