Founded in 1971 in San Francisco, California, Charles Schwab is the largest publicly traded investment services firm in the world with over $535 billion in total assets on their balance sheet as of March 2023. There are also ~34.3 million clients worldwide using Charles Schwab as their brokerage service.
Are you interested in becoming a wealth management client with Schwab? In this article, we’re going to go over everything you need to know about Charles Schwab Private Client and Wealth Management to help you decide if this firm can help you meet your long-term financial goals–and if it’s worth the fees.
What Is It?
Schwab Wealth Management is a subsidiary of financial services company Charles Schwab. This firm offers investment advising and portfolio management services to help you create a wealth management strategy at any stage of your life.
Wealth management is available through Charles Schwab Private Client. This is a relationship package that connects you with a dedicated Private Client Advisor as well as a Financial Consultant.
Your Financial Consultant will point you in the right direction when you have questions and serve as an intermediary between you and the brokerage firm. Your Private Client Advisor will help you manage your portfolio and provide ongoing investment guidance.
You must pay to be a Private Client and meet the requirements to qualify. See the next section for details.
How to Become a Private Client + Fees
To become a Private Client, you must have at least $1 million to invest when enrolling. If you already have a Financial Consultant with Charles Schwab, ask them about becoming a Private Client.
There is a fee for being a Private Client. The annual asset-based fee is 0.8% to start but decreases as your investment balance increases. Take a look at the fee tiers below:
- For the first $1 million in billable assets, you will pay a fee equal to 0.80% of your portfolio.
- For the next $1 million in billable assets (between $1 and $2 million), you will pay a fee equal to 0.75% of your portfolio.
- For the next $3 million in billable assets (between $2 and $5 million), you will pay a fee equal to 0.70% of your portfolio.
- For all assets in excess of $5 million, you will pay a fee equal to 0.30% of your portfolio.
There are no fees for making withdrawals, individual fees for consulting and advising services, internal transfer fees, or direct deposit fees. You will pay the same investing fees as anyone else investing with Charles Schwab.
All Private Clients receive the same level of wealth management features and benefits outlined in this article.
Who Is It For?
Private Client wealth management from Charles Schwab is designed for high-net-worth individuals. This is not a low-cost service, so it is not recommended for beginners or those just starting out with investing.
To make the most of membership with this firm, you should already have at least some clear goals for your retirement, investments, and personal wealth. While you will collaborate with your Private Client Advisor to create a personalized strategy, you will benefit from their expertise most if you have specific questions about what investments you should be making.
You also must have at least $1 million to invest, which will be a significant barrier for most. And the more you invest, the lower your fees, so those with more than $1 million to invest will save significantly.
Schwab Wealth Management services can be especially beneficial for those with complicated financial situations or goals. With ongoing advising and tracking, you will have the support you need to make your strategy a reality no matter what changes may occur.
📌 Related: Want to take advantage of record high interest rates? Check out the FDIC-insured brokered CDs offered through Charles Schwab.
Features and Benefits
As a Charles Schwab Private Client, you receive comprehensive wealth management services that include the following:
- Investment planning
- Retirement planning
- Tax planning
- Estate planning
- Risk management and insurance
- Banking and credit management
- Education and family support
All of the advice and guidance you receive as a Schwab Private Client is completely personalized to your situation and goals.
Working with Schwab as a Private Client is an “ongoing collaboration, with you in control” that focuses on a wealth management strategy, an experienced team, and a personalized approach. Let’s dig into each of these aspects.
Wealth Management Strategy
You will work with your Private Client Advisor to develop a wealth management strategy that is goal-oriented, diversified, and disciplined. You will discuss the specific goals that you have now and in the future as well as needs that can be met through investing, whether that’s growing your personal wealth, planning for your retirement, or something else.
You will have access to a wide range of investments through Schwab Private Client Investment Advisory, from stocks and bonds to ETFs and mutual funds. Advanced trading like options and futures trading is also available. Your Advisor will help recommend investments to you based on your income, risk tolerance, etc.
On an as-needed basis (when you contact your Advisor), your portfolio’s performance will be reviewed to ensure that you are on track to meet your short- and long-term goals. Your Advisor will help you make adjustments as needed.
All Schwab Private Client Advisors and Financial Consultants are experts in their field and highly qualified. Each Private Client has one of each kind of wealth specialist on their team. Your Financial Consultant will serve as a coordinator between you and your Private Client Advisor and you and the brokerage firm as a whole. Your Private Client Advisor will provide the following services:
- Portfolio evaluation and investment recommendations
- Assessment of your wealth management needs
- Progress monitoring for your wealth management strategy and adjustments
Your Advisor is an expert on topics including risk management, asset protection and hedging strategies, executive compensation, business succession, charitable giving, fixed income, liquidity needs, and more. You can contact your wealth specialists whenever you have a question or concern. Note that only Schwab Private Clients receive dedicated advising from an Advisor of their own.
The final component of Private Client wealth management is a personal approach to your strategy that includes conversations with your team of wealth specialists, collaboration between you and your team, execution of the strategy you agree on, and evaluation of your portfolio’s success on an ongoing basis.
If at any point your needs change or you feel your strategy needs to be reassessed, your Private Client Advisor will review your situation with you to help you strategize and update your portfolio and financial plan. Every investment strategy is completely unique to the individual Private Client.
All of these services are included under the cost of being a Private Client. For example, you will not be charged a separate fee when you meet with your Financial Consultant or Private Client Advisor.
Pros and Cons
✅ Easy to use. The platform is comprehensive and fairly easy to use, making it a great choice for beginners and intermediate investors alike. Advisors are plenty knowledgeable and some of the best you could ask for, and this brokerage has a reputation for delivering quality recommendations and results overall.
✅ Many choices. With Schwab, you have a lot of choices when it comes to how you invest your wealth. Charles Schwab offers a robust suite of products to trade and tools you can use to make informed decisions about them, so you won’t really feel like you’re missing out on much if you go with this brokerage. Cryptocurrency options could be better but this shouldn’t hold you back much.
✅ Highly personalized. Private Client is a highly personalized wealth management service. You will not receive generic advice from anyone on your financial team. And with a dedicated Financial Consultant and Private Client Advisor, you will enjoy above-average customer service and have multiple options for getting help in a timely manner when you need it.
🛑 Fees. The fees for Charles Schwab Private Client are actually right around average for wealth management firms, but it’s still a lot to pay. Not only is the flat fee for Private Client services high, but trading fees for activities such as options trading and margin trading are rather high as well.
🛑 No automatic rebalancing. Your portfolio won’t be automatically rebalanced when the market is especially volatile. This is something that other brokerages might do for you.
🛑 Your advisor won’t invest for you. Any time you want to update your portfolio or have a question about your strategy, you need to contact your Private Client Advisor yourself. They will provide recommendations but won’t invest for you. If you don’t know what questions to ask your advisor, you might struggle to make the most of this service. While it’s nice to have the option to reach out, you might be looking for something less involved.
Is It Worth It?
Whether or not the price of Charles Schwab Private Client wealth management is worth it for you really comes down to how you plan to use these services.
While you can find a wealth management account with lower fees, this is one of the most comprehensive products out there. If you have big investing goals, a complicated financial situation, or just a lot of money to manage, this service is going to be far more worth it than if you were just starting to invest and hadn’t thought about your long-term goals much.
You can probably find a service that will let you keep a larger percentage of your returns, but if you value customer service and personalized financial guidance, Schwab Private Client can provide these things. To really maximize the service, you should definitely contact your Private Client Advisor and Financial Consultant regularly with questions and use the resources available to you.
Schwab also offers a satisfaction guarantee. If you’re not completely satisfied with your experience as a Private Client, you may qualify for a full refund of all eligible fees as long as you make your request within 90 days of paying the fee. For Schwab Private Clients, this includes your program or advisory fee. You can contact your Financial Consultant with any concerns or to request a refund. Trade fees do not qualify for a refund.
If you’re looking for a more affordable alternative, you might consider a robo-advisor. Robo-advisors use automated investing algorithms to choose and execute investments for you based on your profile. Because they are primarily digital, they are able to charge much lower fees than traditional wealth management and advising firms. This is also more hands-off for you, the investor, as the robo-advisor will do almost everything for you.
Related: Compare this to Citi Personal Wealth Management to see which one may be right for you.
Overall, Charles Schwab Private Client and wealth management is not a bad option for you if you meet the specific criteria for making the high fees worth it. It is a comprehensive service with many beneficial features for experienced investors with short- and long-term goals.
This service is not a good fit for the average investor but for high net-worth individuals who are more than happy to pay higher fees for more personalized advice and above-average customer service. Beginning investors may not benefit much from becoming Private Clients. If you’re looking for an option with lower fees, another brokerage or robo-advisory services could be better.