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Updated on Thursday, August 12, 2021
T. Rowe Price is a financial services firm with a long history of providing a wide range of investments at a low cost. It’s particularly known for its variety of no-load mutual funds and workplace 401(k) plans.
T. Rowe Price also has a vibrant discount brokerage business. Customers have access to investments ranging from outside mutual funds to stocks, bonds, exchange-traded funds (ETFs) and options.
|$1,000 and up, depending on the type of account|
- What T. Rowe Price offers and who it’s for
- T. Rowe Price fees and costs
- T. Rowe Price investing tools and research
- T. Rowe Price user experience
- T. Rowe Price investor education
- T. Rowe Price security
- Alternatives to T. Rowe Price to consider
What T. Rowe Price offers and who it’s for
T. Rowe Price primarily appeals to traditional investors looking for commonly held investments like stocks, bonds and mutual funds or retirement-oriented investors who want professionals to choose and/or manage their investments for them. The firm’s actively managed mutual funds, in which managers continually monitor and select investments, are a draw, and they largely outperform both their benchmarks and their competitors. Over a 10-year period through June 30, 2021, more than 76% of the company’s stock funds outperformed their Lipper averages. Its retirement funds perform even better; more than 95% of funds have a 10-year track record of beating their Lipper averages.
Until very recently, day traders were essentially discouraged at T. Rowe Price, as the firm charged $19.95 per stock trade until March 1, 2021. However, in line with most of its peers, the company now has joined the ranks of discount brokers and charges $0 commission for most online stock and ETF trades. The firm still doesn’t allow crypto trading, and it’s lacking some of the day-trading research and capabilities of some of its competitors, such as TD Ameritrade. Thus, more speculative traders may still prefer other options for online brokers.
- Mutual fund performance: The vast majority of T. Rowe Price mutual funds have outperformed their Lipper benchmarks over the past 10 years.
- $0 commissions: The firm no longer charges commissions for online stock and ETF trades.
- Low-cost, highly rated mutual funds: T. Rowe Price offers 152 no-load mutual funds and more than 70 of its funds have earned 4- or 5-star rankings from Morningstar, based on risk-adjusted returns.
- Tools and services to help analyze and plan your portfolio: T. Rowe Price offers a number of financial tools, which range from online fund screeners and portfolio analysis tools to full-fledged financial plans created by T. Rowe Price financial advisors.
- No crypto trading: Crypto is still a highly speculative asset class, but it’s booming in popularity and is offered at some of T. Rowe Price’s competitors, including Robinhood and SoFi.
- Steep account minimums: Minimums to invest with T. Rowe Price start at $1,000 in an IRA and rise to $2,500 in a regular taxable account.
- Added fees: T. Rowe Price charges a $30 annual fee just for the privilege of opening a regular brokerage account. However, these fees can be waived if you hold $50,000 or more in T. Rowe Price mutual funds and/or brokerage accounts, pay the $40 cash management service fee or qualify for the Select Client Services program (with total investments of $250,000 and up). Transferring an account out of T. Rowe Price will cost you $50.
- Limited resources for traders: Although T. Rowe Price offers abundant investor education materials, it’s not very helpful for those looking to day trade or speculate.
T. Rowe Price fees and costs
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|Stock trading fees||
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Now that T. Rowe Price has done away with commissions on online stock and ETF trades, the firm’s pricing structure is more in line with the rest of the industry. However, the annual account fee, even though it is waivable, is a bit of an anachronism these days. The firm also falls short when it comes to options pricing, as most firms like TD Ameritrade, Charles Schwab and others charge just $0.65 per options contract, with no additional commissions. T. Rowe Price still charges $9.95 plus $1 per contract.
T. Rowe Price investing tools and research
T. Rowe Price offers a variety of investing tools and research via its website, including:
Mutual fund research tool
The mutual fund research tool allows investors to screen all mutual funds available at T. Rowe Price. Funds can be viewed in an overall summary view or by prices, yields, or category and volatility. The tool allows for sorting by specific variables, such as risk potential, 1-, 5- or 10-year performance, gross or net expense ratio and many other factors.
Morningstar Portfolio Manager
The Morningstar Portfolio Manager is a proprietary tool that you can access as a T. Rowe Price customer. You’ll have to register for the service online. Once logged in, you can monitor your portfolio’s performance or view its underlying holdings.
Personalized retirement planning service
The T. Rowe Price Planning Service offers a personalized financial plan to help you meet your goals, drafted by a T. Rowe Price financial advisor. The service is free, but it requires a minimum of $250,000 in assets.
Retirement income calculator
The T. Rowe Price retirement income calculator is an online tool that can help customers see where they stand in terms of reaching their retirement goals. The tool is based on client inputs regarding their personal finances and can be used to envision various hypothetical scenarios and the likelihood of success under each.
Investment allocation tool
The investment allocation tool uses client inputs to generate recommendations for either an individual T. Rowe Price mutual fund or a portfolio of funds. You can also get generic asset allocation advice based on your self-reported investment objectives and risk tolerance.
T. Rowe Price user experience
T. Rowe Price offers a completely solid website experience, providing users with easy access to all of the account information they would need. The presentation is clearly geared toward long-term investors, as it doesn’t offer advanced trading tools or promote short-term or day trading, as firms like Webull brokerage account do. However, if active trading isn’t really your thing, the T. Rowe Price online experience is completely satisfactory.
T. Rowe Price offers mobile apps for both iPhone and Android users, and user ratings range from 4.2 stars to 4.7 stars. The firm also offers a mobile-friendly workplace retirement website. The apps use 128-bit encryption and offer the standard range of features, from viewing of account balances, transactions, asset allocations and charts to conducting trades.
T. Rowe Price offers 24-hour automated phone service at 800-638-2587. Customers can reach a live agent Monday through Friday from 8 a.m. to 8 p.m. EST. You can also send a secure email through the website or reach the firm via the U.S. mail.
T. Rowe Price investor education
T. Rowe Price offers extensive investor education tools, including analysis and news about market trends, the global economy, mutual funds and individual stocks. Its market summary/news section is powered by FactSet. The website’s “Resources” section offers considerable information about retirement, college planning, estate planning and taxes. The firm offers free webinars as well, but those are only available on the T. Rowe Price institutional website.
All of these resources are free and valuable to investors, particularly beginners or those looking for information about a topic that is new to them. The firm as a whole is geared toward long-term savers and investors, so you won’t find information on topics like options spreads or day trading as you might at other firms like Robinhood or Webull brokerage account.
T. Rowe Price security
- SSL encryption
- SIPC insurance
- Excess insurance
T. Rowe Price has been providing dependable service and account management for over 80 years. The firm offers standard Securities Investor Protection Corporation (SIPC) of $500,000, of which $250,000 can be used to cover cash awaiting investment. Assets held in custody by the firm’s partner, Pershing, are protected by an aggregate loss limit of $1 billion, with a per-client loss limit of $1.9 million in cash awaiting reinvestment.
On the electronic side, T. Rowe Price protects customers by using two-factor authentication for login on both desktop and mobile applications. It also offers industry-standard SSL encryption. Customers are insured against loss due to cyberattack or other fraudulent activity thanks to the T. Rowe Price Account Protection Program.
Alternatives to T. Rowe Price to consider
Two of T. Rowe Price’s main brokerage competitors are Fidelity and Vanguard.
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|T. Rowe Price||$0||$2,500||Actively managed mutual fund lineup|
T. Rowe Price vs. Fidelity
Like T. Rowe Price, Fidelity has a robust no-load mutual fund lineup, but it also caters to active traders and those in need of in-depth research. Fidelity also has four proprietary ETFs with no annual expenses, which remains unique in the industry. The lack of any minimum deposit requirements is another advantage Fidelity holds over T. Rowe Price and its antiquated account minimums.
T. Rowe Price vs. Vanguard
T. Rowe Price and Vanguard are often the two names at the top of investors’ minds if they are looking for strong no-load mutual fund lineups. With T. Rowe Price dropping its trading commissions to $0, the broker now is a strong contender with Vanguard. In some cases, the choice between these two firms may come down to which proprietary mutual fund lineup an investor prefers, and whether they prefer actively managed or index funds. Vanguard is the undisputed king of index funds, with nearly $4 trillion invested in its index funds and ETFs.
The “Find a Financial Advisor” links contained in this article will direct you to webpages devoted to MagnifyMoney Advisor (“MMA”). After completing a brief questionnaire, you will be matched with certain financial advisers who participate in MMA’s referral program, which may or may not include the investment advisers discussed.