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ShareBuilder Review & Complaints: Brokerage & Retirement

Our ShareBuilder review finds the investment company is below average. ShareBuilder provides only basic investment tools for active traders, and their high fees make ShareBuilder a less than ideal choice for any day trader looking to build an investment portfolio.

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Eric Stauffer is a former insurance agent and banker turned consumer advocate. His priority is to help educate individuals and families about the different types of insurance they need, and assist them in finding the best...

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UPDATED: Sep 14, 2020

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ShareBuilder, along with its parent company Capital One, operate under the sentiment that investing need not be so complicated. This mantra is evidenced in their website design. Only moments after initially visiting the homepage it becomes clear, which I must say is refreshing considering the number of complicated, clunky brokerage websites available.

ShareBuilder seems to have tailored their business to the novice investor. This strategy of befriending the little guy is contradictory to most of their direct competition; for this reason it seems ingenious and more over, appears to be working.

With ShareBuilder you get what you get, and that is not very much. But it is for this reason precisely that it is the perfect online brokerage solution for beginner investors. This is a different demographic than say Vanguard, who is built for the long-term investor with significant funds.

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“A big high-five for $6.95.” –

ShareBuilder’s $6.95 stock trade fee and option base fee come in lower than the full-service brokerage houses including, Fidelity, E*Trade, Scottrade, TD Ameritrade and Charles Schwab. However, they are considerably higher than OptionsHouse ($4.75) & TradeKing ($4.95), both considered discount brokers and therefore are more appropriately comparable.

To recap cost, ShareBuilder does well in positioning itself in the saturated market of online brokerage firms by gunning for the little guy, however, seems to contradict this approach with comparably high investment costs. These costs may be justified as ShareBuilder has built their reputation on automatic investing (tailoring to the novice trader & not the experienced day trader), meaning these higher fees will be realized less often than someone actively updating their positions.

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Trading Platform

ShareBuilder, unlike most online brokerage houses, does not offer many trading tools, at least in the traditional sense. You can still trade via ShareBuilder’s website.

This simplistic method of offering few tools and platforms aligns with ShareBuilder’s goals, to provide a streamlined and easy to use system, but can significantly handicap an active trader looking for cutting edge tools and data.

Why is this important to you?

If you are an investor looking to research market trends, view live streaming access to news and are wanting to take this information as it happens in real time, ShareBuilder will let you down. But at the same time, remember you are not paying for these services with either. Sharebuiler will provide the basic, necessary tools required to manage a portfolio and make trades, but most importantly make it easy for an investment approach geared towards automation.

To the point of automation, ShareBuilder offers what they call an Automatic Investment Plan which essentially enables you to build a portfolio steadily over a period of time through reoccurring deposits and automated options, ETF’s & mutual fund purchases.

ShareBuilder offers “Portfolio Builder,” allowing the investor to construct a portfolio designed to their investment style. With other firms, this is often accomplished with the assistance of experienced trade professionals and money managers (as well as a high price tag). The difference between the standard approach to portfolio creation & diversification and ShareBuilder’s approach is they simplified it for the novice investor. It certainly does not mean its better long-term, but will get someone will little experience at least pointed in the right direction.

ShareBuilder’s Portfolio Builder will take you by the hand (figuratively of course) and go step-by-step through the process of diversification, ensuring you do not place all of your eggs in one basket.

Portfolio Builder offers:

  • Low initial investment requirements ($200)
  • Dollar-cost averaging (including partial shares)
  • Flat commission per portfolio

Retirement Plans

They make retirement savings a no-brainer.

Although ShareBuilder does not offer a bunch of in-house, market tested mutual funds like the Vanguard’s of the world; they do offer an un-intimidating approach to saving for your future.

Here is what ShareBuilder offers:

  • Traditional IRA’s
  • Roth IRA’s
  • Rollover & transfer options
  • 401(k)

If you are new to the world of retirement saving, have relatively little funds and are simply looking to take that first step, ShareBuilder is worth considering (especially if you bank with Capital One 360).

ShareBuilder IRA’s offer:

  • Access to no-load mutual funds, bonds funds, stocks & ETF’s
  • No annual maintenance fees
  • Access to retirement specialists (business hours) by phone & live chat
  • Free access to ShareBuilder’s Knowledge Center

ShareBuilder also offers tools, such as Retire MyWay, that interacts with the investor to help determine things like the required amount of savings and automated contributions based upon goals later in life.

Banking Features

ShareBuilder offers extensive banking services, including checking, savings, business savings accounts & loans. These are provided through their banking arm, Capital One 360 (Formally ING Direct).

Let’s take a look at what is offered:

  • 360 Checking
    • 38,000+ Allpoint® ATM’s
    • No monthly fees
    • No minimums
  • 360 Savings
    • No minimums
    • No fees
    • Variable APY
    • FDIC insured ($250,000)
  • Loans
    • Mortgage solutions
    • Quick & easy application process
  • Business Savings Accounts
    • No fees & no minimums
    • 401(k) business solutions

The bottom line here is their banking services are great. The rates are reasonable given the current interest landscape, and the ease-of-use knocks it out of the park.

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ShareBuilder Overall

ShareBuilder is by their own assessment considered a discount brokerage house, offering less frills and gimmicks in an effort to pass cost savings on to you, the end user. They have positioned themselves in the market to be attractive to the novice investor looking to take advantage of their automated investment strategies through scheduled, reoccurring deposits.

ShareBuilder’s simplified website design, non-existent trading platforms, high cost, and minimal investment tools make them a below-average choice for an active trader.

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About Eric Stauffer

Author: Eric StaufferI am a former insurance agent and banker turned consumer advocate. My priority is to help educate individuals and families about the different types of insurance they need, and assist them in finding the best place to get it.

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