rewrite this title Vanguard vs. Robinhood: Which Platform is Right for You?

In the world of online investing, you’ve got plenty of choices. In fact, the number of options can be overwhelming, particularly if you’re just getting started as an investor. If you’ve been doing research, you’ve probably heard of both Vanguard and Robinhood and you may be wanting a Vanguard vs Robinhood comparison.

Good news: we’ve got what you need! While these two platforms might not appear to have very much in common, either might be right for you as a beginner. It depends on your strategy and preferences.

Both are well-regarded and well-reviewed trading platforms. Both offer multiple trading options and mutual funds and have focused on providing a user-friendly experience for investors. Vanguard has a longer history and is more geared toward traditional investments like mutual funds, while Robinhood is newer and provides a mobile-first experience.

We’re comparing the two because they represent two different approaches to investing. While Vanguard offers investors more asset classes, Robinhood is the only one of the two that allows cryptocurrency trading and no minimum account balance. Both offer retirement accounts, and both are FINRA members that are regulated by the SEC.

Keep reading to compare Robinhood vs Vanguard and learn about their similarities and differences, how much they cost, and which one is the right choice for your investment journey.

Robinhood vs Vanguard: Key Differences

Let’s start by exploring some of the key differences between Robinhood and Vanguard. We’ll focus on two of the most important considerations when choosing an online brokerage: account types (with a special focus on retirement) and investment asset classes.

Account Types Available

If opening a retirement account is important to you, then you should be aware that Vanguard offers more types of accounts than Robinhood.

Vanguard users can open these accounts:

Traditional and Roth IRAs

401(k) rollovers

SEP accounts

Spousal IRA

SIMPLE IRA

529 account

UGMA/UTMA

By contrast, Robinhood offers only two account choices: traditional IRAs and Roth IRAs. That said, they also offer something that Vanguard doesn’t: IRA matching contributions. Anyone with a free Robinhood account receives 1% matching if they open an IRA. Robinhood Gold members pay for membership but get 3% matching plus other benefits in return.

Investment Choices

One of the most important things new investors should know is the basics of portfolio balancing and diversification. These things protect investors by ensuring that they don’t have too high a percentage of their total holdings in any one asset or asset class. In other words, you need a mix of investments with different risk factors in your portfolio.

Robinhood doesn’t have a huge array of asset classes, but it does offer access to a large number of stocks and exchange-traded funds (ETFs) which allow investors to diversify their stock holdings. They also offer investors the opportunity to trade cryptocurrencies such as Bitcoin, Ethereum, and DOGE. They offer a total of 22 coins to trade as of January 2025.

Vanguard has a larger number of assets and mutual funds to invest in, including:

Stocks

ETFs

Mutual funds

Bonds

Certificates of Deposit

Options

What does all of this mean for you as an investor? True portfolio diversification requires buying different types of assets that don’t react to economic pressure the same way. For example, when stock prices are in a downturn, bonds can provide stability and security.

You can use Robinhood to diversify your stock holdings, since you’ll have access to 10,000+ stocks and ETFs, including just about everything traded on the US stock market. You can also buy cryptocurrencies, which some investors view as a hedge against inflation. If you do buy crypto, keep in mind that it’s a far more volatile asset than stocks or bonds.

One final note is that Robinhood allows for fractional trading of stocks, ETFs, and cryptocurrencies, and Vanguard only allows fractional trading for ETFs.

Pro Tip:

Sign up today and receive up to $1500 of stock per year by referring friends on Robinhood!

Vanguard vs Robinhood: Performance

While a company’s history isn’t necessarily a sign that it’s a good fit for your investment needs, we do think it’s useful to know a bit about Vanguard vs Robinhood in terms of each company’s performance.

Let’s start with a few salient facts about Vanguard.

The company was founded in 1975 by John C. Bogle.

At first, Vanguard had only three employees at the time of its IPO. Today it has approximately 20,000 employees.

The IPO was expected to raise $150 million, but raised only $11 million.  

As of 2024, the Vanguard investment platform has 50 million users.

Vanguard is a privately held company with approximately $10.1 trillion assets under management (AUM).

Now, let’s look at Robinhood.

Robinhood was founded in 2013 by Vladimir Tenev and Baiju Bhatt with the mission of democratizing investing.

As of 2024, Robinhood has approximately 10 million active users.

Robinhood has grown from being a two-many operation to having approximately 3,800 employees.

Robinhood is a publicly traded company and has a market capitalization of $44.52 billion as of January of 2025.

In November of 2024, Robinhood had approximately $194 billion in assets under custody (AUC).

Both companies have experienced impressive growth and have shown that they can stand the test of time.

Vanguard vs Robinhood: Trading Fees and Commissions

One of the things you’ll want to consider before choosing an online brokerage is how much you’ll pay in fees. Robinhood was a pioneer in the world of commission-free trading, but that doesn’t mean there are no fees involved. Vanguard offers low fees for mutual funds but other fees are higher.

The area where fees for Vanguard can get confusing is if you buy mutual funds. Most of Vanguard’s funds don’t have a trading fee, but a few do. You’ll need to make sure to read the fine print. Mutual funds and ETFs that aren’t administered by Vanguard do come with fees that vary.

You can find Robinhood’s full fee schedule here, and Vanguard’s fee schedule here.

Vanguard vs Robinhood: User Experience

Both Robinhood and Vanguard have worked to provide users with a satisfactory and intuitive user experience. 

Robinhood’s mobile app and website offer similar experiences. They don’t have a ton of features, which may be part of why their interfaces are so streamlined. There’s limited market information available and not much in the way of research and analysis tools, but that’s not where Robinhood shines. What we like is how easy it is to initiate and finalize trades. 

Vanguard offers more in the way of features, including screeners and charts. On the surface, that makes the interface feel more complicated than it actually is. We think that even beginners can learn how to use Vanguard quickly.

Pro Tip:

Sign up today and receive up to $1500 of stock per year by referring friends on Robinhood!

Robinhood IRA vs. Vanguard IRA: Which Is Better for Your Retirement?

Both Robinhood and Vanguard offer users the option to open an Individual Retirement Account. There are some differences you should know about.

IRA Options and Benefits

As we’ve already noted, Robinhood offers two IRA options, traditional and Roth. A traditional IRA allows for pre-tax contributions, while Roth contributions are made on a post-tax basis. Many people prefer a Roth because gains and withdrawals are tax-free.

Vanguard offers both traditional and Roth IRAs, along with SEP, SIMPLE, and spousal IRAs. You’ll have more flexibility with Vanguard, but Robinhood offers matching contributions and Vanguard doesn’t. If you’re someone who doesn’t have an employer-sponsored retirement plan, opening an IRA with Robinhood allows you to take advantage of matching funds.

Tax Benefits and Contribution Limits

There’s no difference between Vanguard and Robinhood when it comes to IRA contribution limits. These limits are set by the IRS and they don’t vary from brokerage to brokerage. For 2025, the annual contribution limit for IRAs is $7,000. There’s a catch-up contribution of $1,000 for people over the age of 50. As of 2025, the catch-up limit will be tied to a cost-of-living adjustment.

There are tax benefits associated with IRAs, and these are also determined by the government. Traditional IRA contributions are made on a pre-tax basis and you may be able to deduct them, depending on your circumstances. You will pay taxes on your distributions, including any profits you made on your investments. Roth IRA contributions are made on a post-tax basis, so you won’t pay taxes on your distributions, including any earnings from your investments.

Retirement Planning Tools

One area where Vanguard clearly comes out on top is in retirement planning. If you have a portfolio with Vanguard, you can get financial advice to help with retirement planning, Vanguard mutual fund recommendations, and retirement calculators. These can all help you manage your portfolio and determine how much money you need to have saved to have a comfortable retirement.

Robinhood doesn’t have retirement planning tools, so if you decide to use Robinhood, you’ll need to find those tools elsewhere.

Pro Tip:

Sign up today and receive up to $1500 of stock per year by referring friends on Robinhood!

Which Platform Suits Your Needs?

The question for you is which of these two platforms best suits your needs as an investor? Here’s our take.

Robinhood’s free account is ideal for beginning investors who want to start building a portfolio without paying commission. You can start investing with as little as $1, and since Robinhood allows for fractional trading of stocks, ETFs, and cryptocurrencies, you can engage in some diversification as you learn about investing. 

We also like Robinhood’s simple and user-friendly interface. It’s not the place to do extensive research or get guidance on how to invest, but it’s a useful tool for those who value simplicity. Finally, Robinhood matches users’ IRA contributions.

Vanguard offers more overall investment options, plus the opportunity to get professional investment advice if you need it. It also has a robo trader if you’re looking for guidance at a low cost. There are some additional retirement options, but they don’t offer matching funds.

Vanguard is best suited for those who want professional guidance and are willing to use a buy-and-hold strategy. 

Conclusion

In our Vanguard vs Robinhood comparison, there are a lot of similarities and a few important differences.

If you’re someone who doesn’t mind being self-directed and doing your own research, Robinhood’s low costs and streamlined interface make it a good choice. We also prefer Robinhood for IRAs because of their matching program, which is something that most brokerages don’t offer.

Vanguard offers more in the way of professional advice, with a few additional retirement options and more asset classes overall. However, there’s limited fractional trading and no IRA matching, so you won’t have the opportunity to accelerate your retirement savings. On the whole, we think Robinhood is the better choice for a lot of people who want to save for retirement. You can set up a traditional or Roth IRA for free, take advantage of matching funds, and buy fractional shares.

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