Schwab is generally efficient with excellent service. But I just started opening a bank account with them (strictly for the no fee ATM card that I'll use as backup) and found both the procedure and documentation a bit quirky.
- You must download and mail (or walk in) the account application.
- The application says that you can't get an ATM card before the account is funded, yet I received email w/i hours saying a card was on its way.
- The email said I'd opened a checking account even though I'd opened a savings account.
- You can't make deposits by check to a Schwab bank account at any Schwab branch.
- If you don't make the opening deposit via transfer from another Schwab account (we have only IRAs there), you can do it via transfer from another bank (on the application), but I was told this will take weeks. In contrast, I was able to link my Fidelity account to the new Schwab bank account same day; Fidelity says it will take 1-5 days to become active. Though it seemed to be active the following morning.
- Schwab is unable to transfer beneficiary names from a brokerage account to a bank account. They were able to print my beneficiary list and have me fill out a paper beneficiary form while I was at a branch.
- The mailing address for deposits on the bank application form (dated 3/25) was wrong, according to the Schwab rep.
Now all of these are petty matters; some likely arise from the fact that Schwab Bank is not Schwab brokerage. In hindsight, I should have opened a taxable brokerage account and gotten an ATM card that way. But who could resist that rich
0.15% APY on Schwab's savings account vs.
0.01% APY in its brokerage accounts?
https://www.schwab.com/resource/how-to-order-new-debit-credit-card
Comments
I have all 3 types of Schwab accounts.
I couldn't link my current credit union until the account was funded (500$ from my brokerage acct) but that was the only hiccup I encountered. I just needed to let the 'system' take a few days to get everything setup.
(I really only opened it for the ATM card, but down the road if my credit union keeps annoying me I could start doing more transactions from Schwab Bank)
Only Fidelity seems to have manual account linking process that takes 7-10 days. It cited security or plan limitations.
Linking to another individual's account is also manual process, typically requiring Medallion Signatures.
I have 1 credit union a/c and 2 bank a/c (including Schwab Bank). At one time, Schwab Bank checking also had decent yield, not not now. I got it just when the feature was starting.
When we were employed we had our salary "checks" electronically transferred to a checking account at the Home Savings branch one block from our SF home. Very convenient. Then Home failed and became JP Morgan Chase. After retirement our pension payments automatically continued to the JPM branch, so we had out SS payments sent there also, just to keep everything fairly neat.
Someplace along the line we also opened a Schwab brokerage account. The Schwab branch is just down the street from JPM, so that was cool.
Then, for some reason that I can't even remember, we got irritated with JPM. So we opened a checking account at Schwab, and set up an automated twice-monthly transfer fro the JPM checking account over to the Schwab checking account. So now JPM only has the use of that money for a very short time. That worked fine, but I noticed a significant delay between the time Schwab bank received the transfer and the time it became usable.
So I changed the transfer to Schwab brokerage, rather than Schwab bank. Bingo! Immediately usable, no delay. Immediately transferable to Schwab bank if needed for checking, no delay. Immediately available for transfer to Schwab MMKT, CDs, or other investments. All very smooth. Works fine, lasts long time.
Checking or savings? Checking can be opened electronically but there doesn't seem to be a way to open a savings account online. Also, a checking account must be linked to a Schwab brokerage account; a savings account can be standalone.
https://www.schwab.com/checking
https://www.schwab.com/savings
These days, I'm not sure what the advantage of a bank account, any bank, is, aside from sometimes better interest rates. And since one can link nearly any bank/CU to nearly any brokerage (at least if the brokerage offers some CMA services), there's usually not much benefit in linking to lower yielding "in house" banks.
One nice feature is that I can write a check or do an ACH transfer from the IC account and any "overdraft" is automatically debited from my brokerage cash position.
Fidelity provides the same feature for its CMA account (debiting from brokerage cash and margin. In this and many other ways, its CMA account acts like Schwab's IC account. I wouldn't activate this feature for any account (CMA or IC) where I had a debit/ATM card - too much risk for me.
At one time, Schwab Bank checking also had decent yield, not not now. I got it just when the feature was starting.
Yup. Back in the day I also used Schwab Bank checking for yield. But that was before GFC and also before Schwab Bank savings was offered. According to the Schwab timeline, IC was offered in 2007 and savings not until 2009.
Rates dropped precipitously after 2007 as we headed toward ZIRP.
02/04/10: 0.60% APY
05/01/09: 0.75% APY
01/14/09: 1.00% APY
12/02/08: 1.50% APY
10/11/08: 2.20% APY
09/17/08: 3.00% APY
05/07/08: 2.01% APY
04/01/08: 2.26% APY
02/05/08: 3.01% APY
10/01/07: 4.00% APY
04/25/07: 4.25% APY
Savings rates were higher. For example, in Feb 2009 they were 2%, vs. 1% for checking.
https://www.depositaccounts.com/banks/charles-schwab-bank/offers/
Does this feature come with the account or does one have to opt in.
Chuck did cover my butt one time when I made a hick up.
Also I wonder to what amount of over draft they would question before paying?
I receive pop ups when making payments that once in awhile will go up a couple hundred bucks over (average) payments.
CapitalOne must have some algorithm that triggers a message asking if I did indeed make a suspicious credit card charge. They seem to know a lot of the bad actors and scams for which I’m grateful. Both Schwab and CapitalOne have given me exemplary service, FWIIW.