Best Schwab ETFs for Low-Cost Investing
Schwab ETFs are among the cheapest available. Here are their best offerings and when they beat Vanguard on cost.
Don't have time? Here's what you need to know:
- 1Schwab ETFs match Vanguard on cost for most core positions (0.03-0.06%)
- 2SCHD is the standout: best-in-class dividend growth ETF with 3.5% yield and 12% annual dividend growth
- 3Schwab's lineup is smaller but covers every core need for index investors
- 4Use Schwab ETFs if you bank with Schwab for convenience; Vanguard ETFs work at Schwab too
Schwab: The Price War Winner
Schwab consistently matches or undercuts Vanguard on fees. SCHB (total market) charges 0.03% — matching VTI. SCHD (dividend growth) at 0.06% is cheaper than VIG at 0.06%. SCHX (large-cap) at 0.03% matches VOO. For Schwab brokerage customers, these funds trade commission-free with tight spreads.
Schwab's ETF lineup is narrower than Vanguard or iShares — about 25 ETFs compared to 80+ from each competitor. But they cover every core position a beginner needs. If you bank with Schwab, using their ETFs simplifies account management.
Best Schwab ETFs Ranked
| ETF | Category | Expense Ratio | Vanguard Equivalent | Schwab Advantage |
|---|---|---|---|---|
| SCHB | Total U.S. Market | 0.03% | VTI (0.03%) | Tie on cost |
| SCHD | Dividend Growth | 0.06% | VIG (0.06%) | Better historical returns |
| SCHX | Large-Cap | 0.03% | VOO (0.03%) | Tie on cost |
| SCHF | Intl Developed | 0.06% | VEA (0.05%) | VEA slightly cheaper |
| SCHE | Emerging Markets | 0.11% | VWO (0.08%) | VWO cheaper |
| SCHZ | U.S. Bonds | 0.03% | BND (0.03%) | Tie on cost |
| SCHG | Large-Cap Growth | 0.04% | VUG (0.04%) | Tie on cost |
| SCHV | Large-Cap Value | 0.04% | VTV (0.04%) | Tie on cost |
SCHD: Schwab's Star Performer
SCHD is Schwab's most notable ETF and arguably the best dividend growth fund available. It screens for dividend consistency, financial strength, and cash flow quality — producing a portfolio of 100 high-quality dividend growers. SCHD has outperformed most dividend ETFs over the past decade with lower volatility.
SCHD yields about 3.5% with a 5-year dividend growth rate of 12% annually. For context: VIG (Vanguard's dividend fund) yields only 1.8% with a 10% growth rate. SCHD's combination of current yield and growth makes it the preferred choice in the dividend ETF category.
Tip: SCHD is an excellent Roth IRA holding. The growing dividend stream compounds tax-free, and you avoid the annual tax drag that dividend income creates in taxable accounts.
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Frequently Asked Questions
Should I use Schwab ETFs if I have a Schwab account?
It is convenient but not required. You can buy Vanguard and iShares ETFs at Schwab commission-free too. Choose the fund with the lowest expense ratio for each category. Schwab ties or wins on cost for most core positions.
Is SCHB as good as VTI?
Essentially yes. SCHB holds about 2,500 U.S. stocks (vs VTI's 4,000+). The missing 1,500 are micro-cap stocks that collectively represent less than 2% of VTI's value. Performance difference is negligible. Both charge 0.03%.
Why is SCHD so popular?
SCHD combines above-average yield (3.5%) with strong dividend growth (12%/year) and quality screens that exclude financially weak companies. It has outperformed most peer dividend ETFs over the past 10 years. The 0.06% fee is competitive.
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Alex Harrington
CFA Level II Candidate, Finance & Economics
Alex Harrington is an independent ETF researcher and personal finance writer with over 8 years of experience analyzing exchange-traded funds. A CFA Level II candidate with a background in economics, Alex has reviewed 800+ ETFs and helped thousands of beginners build their first investment portfolios through clear, jargon-free education.
This content is for educational purposes only and does not constitute financial advice. Past performance does not guarantee future results. Consult a licensed financial advisor before making investment decisions.