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How trustworthy are investment apps like Charles Schwab and Robinhood?

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In May, Robinhood faced user retaliation due to a cryptocurrency trading outage that occurred while dogecoin prices skyrocketed. While the investment app fully restored crypto trading, its server issues prevented many users from placing dogecoin orders.

In addition, when Gamestop (GME) and several other Reddit-hyped stocks soared earlier in 2021, investment apps including Robinhood came under fire for temporarily halting stock purchases. This news also put the business practices of popular

investing apps
, including the compensation model called payment for order flow, under the magnifying glass.

If you’re looking for signs that you can trust an investment app with your money, research is your friend. You can generally find information about an app’s customer complaint history, advertising issues, and other business information by viewing its Better Business Bureau profile.

Below, you can see how investing apps, brokerages, and automated investment advisors stack up when it comes to each platform’s Better Business Bureau rating. But BBB ratings aren’t the only thing you should take into consideration when searching for an investment app; it’s also wise to do your own research and look for any notable news about the company you’re looking to park your money with. And when in doubt, it could make sense to consult a financial advisor or financial planner.

How trustworthy are investing apps and brokerages?

Investing apps let you set up and manage accounts on your own. They typically offer self-directed trading accounts, retirement accounts, and custodial accounts. But cryptocurrency exchanges typically offer different features.

In some instances, online brokerages also provide an automated investing account option. But not all automated advisors offer brokerage services. And crypto apps typically diverge from both. To draw a clearer distinction, we separated brokerages, automated or online advisors, and crypto exchanges into three separate tables.

Below, you can see how investing apps and brokerages stack up when it comes to their Better Business Bureau rating:

Keep reading for a closer look at each investment app’s complaint history.

Ally Invest

Ally Invest provides self-directed trading, automated investing, retirement savings accounts, and forex trading. The investment app has closed more than 40 complaints in the last three years and just over 30 complaints in the last 12 months. The company has an F rating from the BBB.

Charles Schwab

Schwab offers a wide array of investment products, including commission-free brokerage accounts, automated investing accounts, and retirement accounts. It has closed more than 170 complaints in the last three years and roughly 83 complaints in the last 12 months. Charles Schwab has an A+ rating from the BBB.

E*TRADE

E*TRADE offers commission-free brokerage accounts, automated investing accounts, IRAs, and other wealth-building products. The company closed more than 140 complaints in the last 12 months. The BBB gives it an F rating.

Fidelity Investments

Fidelity is an online investment app offering brokerage accounts, retirement accounts, college savings plans, cash management accounts, and more. The company has closed more than 560 complaints in the last three years and just over 340 complaints in the last 12 months, according to BBB data. Fidelity has an A+ rating with the BBB.

Firstrade

Firstrade is a discount brokerage offering investing, custodial, retirement, and cash management accounts. It has closed two complaints in the last three years and one complaint in the last 12 months. The BBB gives it an A rating.

Groundfloor

Unlike other real estate investing platforms, Groundfloor offers fractional real estate debt investments through Limited Recourse Obligations (LROs) and notes. The company has closed two complaints in the last three years and no complaints in the last 12 months. It has an A+ rating from the BBB.

Interactive Brokers

Interactive Brokers offers more advanced trading resources for experienced investors. The company has closed more than 80 complaints in the last three years and more than 50 complaints in the last 12 months. It has a rating of A+ from the BBB.

Merrill Edge

Among Merrill Edge’s offerings are active accounts, automated investing accounts, education savings accounts, and IRAs. The company has closed more than 6,500 complaints in the last three years and nearly 2,830 complaints in the last 12 months. It has an A+ rating with the BBB.

Robinhood

Robinhood is a commission-free brokerage providing stock, option, ETF, and cryptocurrency trades. The investment app closed more than 2,600 complaints in the last three years and nearly 2,060 complaints in the last 12 months. It has an F rating from the BBB.

Roofstock

Roofstock is an online real estate marketplace that lets you buy or sell single-family rental properties. In addition to its A- bureau rating, the company has closed one complaint in the last three years and no complaints in the last year. 

SoFi

SoFi Invest offers fee-free active trading, automated investing, cryptocurrency trading, human advisor access, and more. Its BBB record shows that it closed more than 230 complaints in the last three years and just over 130 complaints in the last 12 months. It has an A+ rating.

Stash

Stash specializes in investing accounts, fractional shares, and retirement and custodial accounts. The company has settled more than 570 complaints in the last three years and nearly 300 complaints in the last 12 months. It has a BBB rating of F.

TD Ameritrade

Though acquired by Schwab, TD Ameritrade offers commission-free trading, automated investing and more. The company has closed more than 370 complaints in the last three years and just over 200 complaints in the last year. It has an A rating with the BBB.

TradeStation

TradeStation is an

online brokerage
offering taxable brokerage accounts, IRAs, and entity accounts. It has closed nearly 40 complaints in the last three years and more than 10 complaints in the last 12 months. The BBB has given it an A+ rating.

Vanguard

Recognized as one of the pioneers of the discount brokerage business, Vanguard offers accounts for just about every type of investor. It has closed nearly 80 complaints in the past 12 months. The BBB gives it an A- rating.

Webull 

Webull offers commission-free trading, retirement investing, cryptocurrency trading, and more. In addition to its F rating, BBB data also shows that the company has closed more than 150 complaints in the last three years and close to 140 complaints in the last 12 months.

How trustworthy are automated investing advisors?

Automated advisors are investment apps that handle all of your accounts for you. Also known as robo-advice, these types of apps are best for beginner or hands-off investors who want professional guidance with their investments. We’ve also included Facet Wealth, a virtual financial planning firm, in this table.

Acorns

Acorns is a micro-investing app that’s best for hands-off investors and retirement savers. BBB data shows that it has closed close to 190 complaints in the last three years and nearly 100 complaints in the last 12 months. Acorns has an A+ BBB rating.

Axos Invest

Part of Axos Financial, Axos Invest Managed Portfolios is an automated investing account offering personalized and professionally managed ETF portfolios. It has closed both four complaints in the past three years and four complaints in the past 12 months, according to BBB data. Axos Invest has an A- BBB rating.

Betterment

Betterment is an automated investing platform offering personal investment accounts, IRAs, trust accounts, checking and cash reserve accounts, and CFP access. Its BBB record indicates that it has closed just over 60 complaints in the last three years and more than 30 complaints in the last 12 months. Betterment has a B+ rating.

Blooom

Blooom provides automated investment management for IRAs, 401(k)s, and other employer-sponsored retirement plans. It has closed one complaint in the last three years and zero complaints in the last 12 months. It has an A rating with the BBB.

DiversyFund

DiversyFund is a real estate investment app offering private commercial real estate investments for nonaccredited investors. It has an A+ rating with the BBB, and it has closed close to 10 complaints in the last three years and four complaints in the last 12 months.

Ellevest

Ellevest is an automated investment app that handles your investment and retirement accounts for you. It has closed more than 20 complaints in the last three years and roughly 13 complaints in the last 12 months. It has a B rating with the BBB.

Facet Wealth

Facet Wealth is a virtual financial planning firm that offers an array of wealth management services. BBB data shows that it closed three complaints in the last three years and one complaint in the last 12 months. Facet has an A+ BBB rating.

Fundrise

Fundrise is a real estate crowdfunding investment app offering automated investments in US commercial real estate investment trusts (REITs). BBB data shows that it closed nearly 60 complaints in the last three years and more than 30 complaints in the last 12 months. The BBB gives Fundrise an A rating.

Marcus Invest

Goldman Sachs-owned Marcus Invest is an automated investing platform offering personalized ETF portfolios for individual accounts, joint accounts, and IRAs. It has an A+ rating with the BBB, and it has closed more than 270 complaints in the last three years and nearly 140 complaints in the past 12 months. 

How trustworthy are cryptocurrency exchanges?

Cryptocurrency exchanges are online brokerages for virtual assets like bitcoin, dogecoin, and others. These investment apps are generally best for active traders who can tolerate the volatility that often comes with crypto trading.

But thanks to features like staking (staking allows you to earn interest for simply holding an asset for a set period of time), passive investors also have a place in the crypto world. See how the following crypto apps rank in trustworthiness.

Binance.US

Binance.US offers more than 50 virtual assets, with features like staking, over-the-counter (OTC) trading, institutional trading, storage, and more. It has settled more than 930 complaints in the last 12 months. The BBB says Binance.US has an NR (“No rating”) because the exchange is in the process of responding to previously closed complaints.

Bitstamp

Bitstamp is a global cryptocurrency exchange offering trading, staking, and various other products for individuals and institutions. Though it’s based in Luxembourg, its US division, BitStamp USA, Inc., currently has an F rating with the BBB. It has closed four complaints in the last 12 months.

Bittrex

Bittrex is a security-focused crypto exchange offering more than 100 cryptocurrencies, with advanced account security, digital wallet services, automated trading, and more. BBB data shows that it has closed nearly 220 complaints in the last three years and close to 190 complaints in the last 12 months. Like Binance.US, Bittrex’s NR stems from the fact that it’s currently responding to previously settled complaints.

BlockFi

BlockFi is a global platform with crypto exchange services, interest accounts, crypto-backed loans, institutional trading, and more. It has a B+ rating with the BBB, and it has closed three complaints in the past 12 months.

CEX.IO

Formed in 2013, CEX.IO is a global cryptocurrency exchange supporting 99% of countries around the world. The exchange has closed five complaints in the past 12 months. It also has an NR status because the BBB doesn’t have enough information to issue a rating.

Coinbase

Coinbase is a popular cryptocurrency exchange offering more than 80 assets, including bitcoin, dogecoin, ethereum, and others. The company has closed more than 2,000 complaints in the last 12 months. Coinbase has an F rating with the BBB.

eToro USA

The eToro USA crypto exchange offers more than 15 cryptocurrencies, with a range of social trading features for novice crypto traders. It has closed 31 complaints in the last 12 months. The BBB has given eToro a C rating.

Gemini

Gemini is a security-focused cryptocurrency exchange offering a wide range of services for individual and institutions. In the past 12 months, the exchange has settled more than 800 complaints. The BBB gives it an NR while it reviews a pattern of complaints issued against the business.

Kraken

Kraken is a popular cryptocurrency exchange offering more than 80 virtual assets, with support for traders in more than 190 countries. The business has closed more than 10 complaints in the last 12 months, and the BBB gives it an F rating.

Voyager

Voyager is an online cryptocurrency broker that offers commission-free trading on more than 60 cryptocurrencies, with a range of services both for individuals and institutions. It has closed nearly 80 complaints in the last 12 months, and it currently has an NR from the BBB since the bureau doesn’t have enough information to issue a rating.

How are Better Business Bureau ratings assigned?

The BBB assess a number of factors when assigning its ratings. While it primarily focuses on how well a company interacts with its customers, its ratings also take into account the following:

  • Type of business
  • Time in business
  • Complaint history
  • Licensing and/or government actions
  • Advertising issues

The BBB also says on its website that its ratings don’t guarantee a company’s performance or reliability. This is why it’s crucial that you conduct your own research before making a final decision about which investment app (or any other personal finance product) to use.

Should you choose an app that has a bad rating?

As mentioned above, BBB ratings don’t guarantee that an investment app or any other company will meet or exceed your expectations. The bureau’s ratings primarily evaluate a company’s complaint history and customer interaction track record.

Therefore, it’s important that you take time to do additional research about prospective investment apps. The BBB’s findings can be helpful in determining whether an investment app is trustworthy, but also consider things like fee transparency and whether it’s registered with the US Securities and Exchange Commission (SEC) and Financial Industry Regulatory Authority (FINRA).

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