I’m a old fart now, but if I am going to keep most of my net worth somewhere, I want it somewhere that if I called their phone number, I’d be confident to have a knowledgable human pick up the phone and help me with my problem. That means Vanguard, Fidelity, and Schwab over Robinhood. Still, competition is good. I like trying out new interfaces and features, and the best of those new apps usually flows down to everyone else. The Robinhood era has helped make everyone’s apps more user-friendly. Commissions are lower. And now even the big boys have are willing to pay you cash to try them out!
Schwab has a Schwab Starter Kit that includes $101 in free fractional shares of stock (“slices”) plus some educational resources. The $101 will be split equally across the top five largest companies in the S&P 500 index – currently Apple, Microsoft, Alphabet/Google, Amazon, and Tesla. (If you do not want the stock shares and just want the $101 in cash, see the fine print quoted below for the short window of time when you can cancel the trades.) To qualify, you must be a new customer opening a Schwab account through that page and deposit at least $50 within 30 days. Emphasis mine:
After you enroll in the offer, here’s what will happen:
Two business days after your account is opened, Schwab will begin checking for qualifying deposits every business day. Once your qualifying deposit has been received, Schwab will credit the $101 cash bonus to your brokerage account at approximately 6:00 p.m. Eastern Time the next trading day. (If you make your qualifying deposit after 8:30 p.m. Eastern Time, Schwab will credit the $101 cash bonus at approximately 6:00 p.m. Eastern Time two trading days later.)
Schwab will send you an email about your 5 trade orders the night before the orders are placed.
Schwab will place the 5 orders for you ($20.20 fractional share orders for each of the top 5 stocks in the S&P 500) at approximately 8:00 p.m. Eastern Time the day the cash bonus is credited to your account, provided you maintain at least $50 in your brokerage account at that time.
You will have a short period of time (from approximately 8:00 p.m. Eastern Time until approximately 9:25 a.m. the next trading day) to cancel the orders.
To cancel the orders, you will need to go to the Order Status page on schwab.com or on any of Schwab’s other trading platforms or call a Schwab representative at 800-435-4000.
If you cancel your orders, you will keep the $101 cash bonus and can save or invest it however you want.
If you take no action, the orders will be executed shortly after market open the next trading day. You will then see the stocks reflected in your account and Schwab will send you trade confirmations for the trades.
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The terms explicitly say you can cancel the trade (as long as you do before market open the day after they are credited), and just keep the cash value. They also say the bonus will be reported on a 1099-INT.
Not a bad quick return on $50. Worth giving Schwab a chance to wow me with their tech.
Thanks for the info!
Thanks, I missed that part. I was thrown off by this FAQ entry that suggests that if you don’t want it, then just open account without a promo code and presumably get nothing:
But as the detailed terms state if you proceed farther through the application:
I’m surprised this didn’t get more interest – it’s a really quick return. Way easier than the $150 from PFS last week.
But if anybody’s on the fence, I just got confirmation they are going to deposit the shares tonight, so this is really easy to complete. Even the trial deposits process for linking the account was faster than usual.
I did get called/emailed by a Schwab salesman, but only once each so far (I ignored them).
I think I’m going to leave these fractional shares rather than take the cash, and I bought some with the $50 as well. Just keeping this in my “play” bucket for now.
I’m not super-impressed with the fractional shares vs. Fidelity, though – with Schwab I can only do fractional on what seems to be a curated list of direct stocks and no ETFs, and it *seems* like I have to go through two interfaces to do full shares vs. fractional. Fidelity, as antiquated as their UI feels, does make this easier.
I assume that existing account holders are excluded?
Just to add, in the past Schwab excluded everyone who already had any accounts with them, but Fidelity always allowed you to qualify for a promo even if you already had relationships with them.
All TD Ameritrade customers READ THIS ! … As you may know Ameritrade is migrating into Schwab .. all customers will become Schwab customers starting in February ! It will be a seamless transition .. But what you don’t know is that Schwab has a 101 dollar incentive for new customers called a starter pack ! .. So , if you are an Ameritrade customer and you start a Schwab acct before the transition in Feb where you become a Schwab customer automatically. Instead you will get $101.00 . Look it up under Schwab starter pack !… Go early and get 101 dollars free since you are going to be transitioned anyway ! This is not an advertisement . This is something I learned thru DD ! TD Ameritrade has millions of customers and if all took this advantage it will cost Schwab millions … so jump on the train before they catch this and curtail the free 101 dollars !
Does anyone know how can you close this start kit account? Will there be any fee?