Merrill Edge® Self-Directed Review: Top Broker With Strong In-Person Support

Merrill Edge® Self-Directed is a top brokerage that offers lucrative perks such as $0 commissions, quality third-party research, and premium customer service. Read our Merrill Edge® Self-Directed review to learn more about the benefits offered and determine if this is the right broker for you.

This stock broker is a good fit for: Investors wanting to combine their investing and banking needs under one roof.

Top perks

Merrill Edge® Self-Directed is one of our favorite brokerages. It ranks among the best brokers we've seen in these categories:

No brokerage is perfect for everyone, but every brokerage tailors its offerings to a certain type of customer. Merrill Edge® Self-Directed stands out from the pack with several main features:

$0 trades

Merrill Edge® Self-Directed, like all of the best stock brokers, now offers commission-free trading for online stock, ETF, and options trades. Note, an options contract fee of $0.65 per contract does apply.

Fee-free debit card and bill pay

Being able to access your account balance at any Bank of America ATM without paying a debit or ATM fee is a major advantage for those who live near a Bank of America branch. Likewise, free bill pay makes it easy to pay bills straight from your account balance.

Account types

Merrill Edge® Self-Directed offers a wide array of taxable brokerage, retirement, small business, and children's investment accounts.

Investment vehicles

The best stock brokers give investors access to a deep bench of investment vehicles. Merrill Edge® Self-Directed is no different, and offers investment vehicles, including stocks, ETFs, options, mutual funds, CDs, and bonds.

National branch access

Many Bank of America financial centers (i.e., branches) have Merrill Edge® Self-Directed advisors available during normal banking hours to help you with your account. If being able to speak to someone in person is valuable to you, this can be a major selling point on its own.

Preferred Rewards program

Merrill Edge® Self-Directed is owned by Bank of America, which has the gold standard for banking loyalty programs. Bank of America Preferred Rewards members can secure rate and fee discounts for most of the bank's products, plus bonus credit card rewards. We review further below the Preferred Rewards program in more detail.

What could be improved

Trading platform

Merrill Edge MarketPro® is a quality trading platform, but it can be beat by other stock brokers.

Margin rates

Merrill Edge® Self-Directed's margin rates are competitive with similar full-featured stock brokers, which all are high compared to what other quality brokers offer.

This discount brokerage has joined the trend of $0 commissions on online stock trades, and no-transaction-fee funds make it an attractive bargain. Base commission prices are detailed in the table below.

Investors who want to invest in mutual funds will find many no-transaction-fee (NTF) choices on par with other large brokerage firms. As for mutual funds, Merrill Edge® Self-Directed offers thousands of no-transaction-fee (NTF) mutual funds, though many may carry upfront or back-end loads (fees that are a percentage of the amount invested.) That said, many funds that traditionally carry loads are load-waived on the Merrill Edge® Self-Directed platform.

Costs aren't just limited to commissions. We read through Merrill Edge® Self-Directed's fee disclosures and found a few notable fees worth discussing in more detail.

• $39.95 early redemption fee for no-transaction-fee funds: Merrill Edge® Self-Directed offers thousands of no-transaction-fee (NTF) mutual funds, but be aware that redeeming your investment within 90 days will result in a short-term redemption fee of $39.95. This is a common fee in the industry, as brokers discourage active trading of no-transaction-fee mutual funds, which are designed for long-term buy-and-hold investors.
• $0 ATM charges: Visa debit cards are free with a Merrill Edge® Self-Directed account, and you can make transactions at any Bank of America ATM for free. Given that other brokers charge a fee just to have a debit card, as well as an ATM fee every time you use it, this is a valuable benefit of using Merrill Edge® Self-Directed.
• Free checks and bill pay: Being a part of Bank of America has its advantages, as Merrill Edge® Self-Directed customers get free checkbooks and online bill pay, which may make it an ideal choice for retirees who are taking distributions from their retirement accounts to cover living expenses in retirement. These features and more make Merrill Edge® Self-Directed worth considering as a stock broker for IRAs.

Merrill Edge® Self-Directed, like many brokers, uses a trading platform that's accessed only by a web browser or its mobile app. Its highly rated mobile apps are available for any customer on an iOS, Android, or Windows device, so virtually any smartphone, tablet, or other mobile device has an app for making trades on the go. Best of all, the mobile app offers all the functionality you would expect of a desktop solution: streaming data, multi-leg (complex) options, and mutual fund trading. That said, Android customers' reviews hover around 3.5 out of 5 as of March 2024. Android users may dislike the in-app experience.

Merrill Edge® Self-Directed margin rates change frequently, and the broker recommends contacting them for the latest rates.

When we did contact Merrill Edge® Self-Directed, the margin rates were higher than average for many full-featured brokers. The same has been the case in several other follow ups checking in about margin rates.

Accordingly, this brokerage may not be the best fit for investors who use margin as an integral part of their investment strategy. Merrill Edge® Self-Directed margin rates are on the higher end of the discount brokerage industry, even for clients who have large balances ($1 million or more).

Of course, margin rates are irrelevant if you don't plan to use margin to leverage your portfolio. Investors who use a cash account can simply forget that margin exists. Investors who use high amounts of margin for long periods to leverage their portfolio will likely want to look elsewhere, however, given the high cost of carrying a debit balance.

One major advantage of using a brokerage that is tied to one of the nation's largest banks is its customer service and support. Clients can get help at thousands of Bank of America financial centers (branches), where there are Merrill Edge® Self-Directed advisors on staff to help you with anything related to your account. For convenience, you can also schedule a meeting with a local representative so as to get in and out as fast as possible, without waiting in line.

Merrill Edge® Self-Directed also offers help 24/7 over the phone. An online chat service is available from 7 a.m. to 11 p.m. ET, Monday through Friday, and from 7:30 a.m. ET to 6 p.m. ET on Saturdays. (We used its online chat service to ask about its operating hours and received an answer within 30 seconds.)

The Bank of America Preferred Rewards program is a big Merrill Edge investing perk, especially for people who are already Bank of America customers. 

Any customer with at least $20,000 in all of their Bank of America accounts and Merrill investment accounts combined is eligible. Preferred Rewards has four tiers, and larger balances mean larger perks. Here's a chart that shows some of the more valuable Preferred Rewards benefits that might interest Merrill Edge® Self-Directed brokerage clients:

In short, if you're a Merrill Edge® Self-Directed or Bank of America customer, especially one with a relatively large account balance, you could earn more interest and save money on other financial products.

Discount brokers are offering more research and other tools to help bridge the gap between barebones discount brokerages and traditional full-service brokerage firms. Merrill Edge® Self-Directed offers a few noteworthy research capabilities to its clients:

• Bank of America/Merrill Lynch equity research: One key advantage to this brokerage is that customers get access to BofA/Merrill Lynch equity research, which covers more than 1,300 stocks on U.S. markets.
• Morningstar & Lipper: Merrill Edge® Self-Directed's online platform quickly shows fund data pulled from Morningstar and Lipper, showing a fund's Lipper rating in its category and a Morningstar rating and "style box" that helps users better understand the fund's investment strategy.
• Stock Story: Merrill Edge customers can click to see a stock's "story," which explains what the company is, how it makes money, how the stock has performed, and what analysts are saying about the company. This feature also uses MSCI's ESG ratings, which quantify how a stock ranks for environmental, social, and governance factors.

Taking into consideration its pros and cons, we think a Merrill Edge account would be a good fit for you if the following statements apply to you:

• You can make the most of the free stock and ETF trades. This is a valuable perk that helps keep more money in your pocket.
• You trade options occasionally, but not heavily. Merrill Edge isn't the best stock broker for options, since the per-contract commission is slightly higher than what you'd be charged for the lowest cost brokers. That said, options trades are free and the per-contract fee is competitive.
• You value customer support. Merrill Edge is one of the few discount brokers that has a large branch network in virtually every single major metropolitan area. If there's a Bank of America office near you, help is just a short drive away.

Compare Merrill Edge® Self-Directed to other brokerages

Wondering how Merrill Edge® Self-Directed stacks up to the competition? Check out our reviews:

At The Motley Fool Ascent, brokerages are rated on a scale of one to five stars. We primarily focus on fees, available assets, and account types; however, we also take into account features like research, education, tax-loss harvesting, and highly rated mobile apps. Our highest-rated brokerages generally include low fees, a diverse range of assets and account types, and useful platform features.

See our full methodology here: Ratings Methodology