Comparing the Big Three IRA Custodians
Picking an IRA custodian has gotten complicated with all the marketing noise flying around. As someone who spent way too many hours comparing Fidelity, Schwab, and Vanguard before rolling over my own 401(k), I learned everything there is to know about the Big Three. Today, I will share it all with you so you don’t have to lose a weekend going cross-eyed reading fee disclosures.
These three companies manage trillions in retirement assets — trillions, with a T. And each one has its own personality. Let’s break them down.
Fidelity Investments
Best for: Active traders, people who want every possible investment option on the menu, and anyone who likes being able to walk into an actual office and talk to a human.
Investment options: Fidelity hands-down offers the most comprehensive selection of the three. Stocks, ETFs, mutual funds (even from competitors — which is kind of cool), options, and they’ve even dipped their toes into crypto through linked accounts. The real standout? Their zero-expense-ratio index funds, FZROX and FZILX. You literally pay nothing in fund fees. That’s exclusive to Fidelity, and honestly, it’s a pretty big deal.
Costs:
- Stock/ETF trades: $0
- Mutual fund trades: $0 for Fidelity funds, $0 for many third-party funds, up to $49.95 for others
- Zero-expense-ratio funds available
- No account minimums
Service: Over 200 investor centers around the country where you can sit down with someone face-to-face. Their phone support runs 24/7, and the mobile app is genuinely good — not just “good for a brokerage,” but actually good. Most people I’ve talked to consider Fidelity’s customer service the best of the big three, and I’d agree with that from personal experience.
Drawbacks: Honestly, the sheer volume of options can feel overwhelming if you’re someone who just wants to park money in an index fund and forget about it. And some third-party mutual funds do carry transaction fees, so you’ll want to watch for that.
Charles Schwab
Best for: Folks who want solid service with that classic brokerage feel, integrated banking, and really thorough planning tools.
Investment options: Schwab gives you a broad selection of stocks, ETFs, and mutual funds. Their proprietary index funds are priced competitively — SWTSX runs at just 0.03%. They’ve also got a strong platform for options and futures trading if that’s your thing.
Costs:
- Stock/ETF trades: $0
- Mutual fund trades: $0 for Schwab funds and OneSource funds
- Low-cost index funds (not zero like Fidelity, but the difference is basically a rounding error)
- No account minimums
Service: This is where Schwab really shines. They’ve got roughly 300 branch locations now, especially after absorbing TD Ameritrade. Phone support is 24/7. And the killer feature? Schwab Bank. You get actual checking accounts and cash management integrated right into your brokerage. I’ve got a buddy who keeps his entire financial life at Schwab just for that convenience, and I totally get it.
Drawbacks: They can’t quite match Fidelity’s zero-fee funds, though we’re talking fractions of a percentage here. The website can feel cluttered at times. And I’ll be honest — the whole TD Ameritrade merger created some temporary headaches, though things have smoothed out considerably.
Vanguard
Best for: Patient, long-term buy-and-hold investors who want the absolute lowest costs and believe in the church of index investing.
That’s what makes Vanguard endearing to us passive investors — they literally invented the index fund. Jack Bogle started a revolution, and the company still carries that DNA.
Investment options: Their lineup of low-cost index funds and ETFs is legendary for good reason. VTSAX at 0.04% and VTI at 0.03% are basically the gold standard that every other company is trying to copy. Where Vanguard falls short is active trading — this is not your platform for day-trading or options plays.
Costs:
- Stock/ETF trades: $0
- Mutual fund trades: $0 for Vanguard funds, up to $20 for others
- Industry-leading low expense ratios
- No account minimums for most funds
Service: Probably should have led with this section, honestly. Vanguard has no physical branches. Zero. Their phone support is available during business hours with limited 24/7 options. The website and app work, but they’re noticeably less polished than what Fidelity and Schwab offer. Service has gotten better in recent years, but it’s still the weakest link.
Drawbacks: Customer service is the Achilles heel. The website feels like it’s from a different era sometimes. Not a great fit if you want in-person advice or if you’re an active trader. Crypto options are limited too, if that matters to you.
Head-to-Head Comparison
| Feature | Fidelity | Schwab | Vanguard |
|---|---|---|---|
| Zero-expense funds | Yes | No | No |
| Physical branches | 200+ | 300+ | None |
| 24/7 phone support | Yes | Yes | Limited |
| Best for active trading | Strong | Strong | Weak |
| Best for passive investing | Strong | Strong | Strongest |
| Integrated banking | Cash management | Full bank | Limited |
The Bottom Line
Here’s what I always tell people who ask me which one to pick: for most rollovers, all three will serve you well. The cost differences between them on a percentage basis are honestly marginal. Go with Fidelity if you want maximum flexibility and the best customer service. Go with Schwab if banking integration and branch access matter to you. Go with Vanguard if you’re a true set-it-and-forget-it index investor who wants the company that started the whole low-cost revolution.
But here’s what really matters, and I can’t stress this enough: just pick one, do the direct rollover, invest in low-cost diversified funds, and stay the course. The difference between choosing Fidelity vs. Schwab vs. Vanguard is a rounding error compared to the difference between leaving your money in a high-fee 401(k) and getting it into a low-cost IRA. Don’t let analysis paralysis keep you from making the move.
