Top brokerages for new investors
Opening a brokerage account is simpler than many first-time investors expect. Most major platforms have streamlined the process to resemble setting up a bank account. The real hurdle is taking the first step before hesitation causes unnecessary delays.
For beginners, selecting the right brokerage can determine whether they continue investing or quit after the first trade. The best options combine low costs, easy-to-use design, and tools that teach without overwhelming users. Below are the top choices based on actual usability, not just advertising.
Fidelity: A platform that adapts as you learn
Fidelity works well for both new investors and those who later want advanced features. Users won’t need to switch platforms as their needs change—everything expands within the same account.
Trades for stocks and ETFs cost nothing, and there are no account fees. The platform also allows fractional shares, letting users invest in high-priced stocks with as little as $1. Customer support is available around the clock, and physical branches provide in-person assistance for those who prefer it.
A minor drawback: Fidelity charges $49.95 to redeem certain mutual funds within 60 days of purchase. The fee can be avoided by holding investments longer, but it’s worth noting for anyone who might need quick access.
The educational materials are especially strong. Fidelity offers free research reports from over 20 independent firms, daily market insights, and screeners to help users find stocks, funds, and ETFs that match their goals. For beginners, this guidance can replace guesswork with informed choices.
J.P. Morgan Self-Directed Investing: Best for existing customers
J.P. Morgan’s brokerage suits those who already bank with the company. The platform integrates smoothly with Chase accounts, simplifying money transfers and financial management in one place.
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Stock and ETF trades are free, and there are no commissions on mutual funds. The mobile app is well-designed, focusing on simplicity—ideal for beginners who don’t want complex menus.
The main limitation: J.P. Morgan’s research tools aren’t as extensive as Fidelity’s. The platform also lacks advanced features like tax-loss harvesting. However, for those who value convenience and familiarity, it remains a good option.
Robinhood: Simplest app-first experience
Robinhood made commission-free trading mainstream and remains one of the easiest platforms for beginners. The app is minimalist, emphasizing quick trades and a straightforward interface. Stocks, ETFs, and options are all free to trade, and the platform offers fractional shares.
A unique benefit: Robinhood lets users receive eligible dividend payments up to a month early. While minor, this can help with cash flow.
The simplicity comes at a cost. Robinhood lacks the research tools and educational resources found elsewhere. It also doesn’t support mutual funds or bonds, which may limit some investors. Still, for those who want to start small and keep things simple, it’s a solid choice.
Key factors when choosing a brokerage
Most beginners make the decision harder than necessary.
The best brokerage removes obstacles—low fees, an intuitive platform, and enough flexibility to grow. Here’s what to focus on:
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Trust. Every brokerage on this list is SIPC-insured, covering up to $500,000 in securities. That protection is essential. Beyond that, consider whether you prefer a familiar brand or one with physical branches for in-person help.
Usability. A platform should feel natural, not frustrating. Some apps, like Robinhood, are designed for mobile use, while others offer more robust desktop tools. Think about how you’ll use the account—will you trade on your phone or research on a laptop?
Fees. There’s no reason to pay for basic trades in 2024. Look for $0 commissions on stocks and ETFs, and check for hidden costs like mutual fund redemption fees. Fractional shares are useful, letting you invest in expensive stocks with small amounts.
Investment options. At minimum, a brokerage should offer stocks, ETFs, and mutual funds. Some also include options, crypto, and specialized accounts like IRAs. If you plan to expand later, choose a platform that can accommodate that.
Education. The best brokerages don’t just execute trades—they help users learn. Look for tutorials, webinars, and tools like paper trading, which lets you practice without risking real money. Fidelity stands out here, while Robinhood keeps things simple but offers less guidance.
The biggest mistake beginners make isn’t picking the wrong brokerage—it’s waiting too long to begin. Starting sooner allows learning by doing, and in investing, time is an advantage that can’t be recovered.
