Thursday 21 September 2017
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Do You Have a Good Broker?

How do you really know? Even if you hired a friend of a friend as your stock broker, it’s tough to really know who has your best interests at heart. While most are inherently good and won’t try to cheat you, a surprising number are only looking out for #1. Choosing the right broker in the first place is important, but it’s also crucial to keep tabs on your broker over the years. This means doing your own research into those “once in a lifetime deals” you’re pitched, and poring over every statement with a fine toothed comb.


So, do you have a good stock broker in your corner? Here are some things to consider:

  1. Loyalty to your goals. A stock broker who stands by her clients through everything to follow through on a plan of lifelong investment is a great sign. Choose a professional who is as invested in your long-term goals as you are and how you go about your investments. You DON’T want someone who’s just going through the motions for the commissions or that will stop returning your calls when you get too conservative.
  2. A qualified professional should have many years of experience. Take a look into your stock broker’s background to find out about education, experience and years in business. Make sure she has the right licenses and registrations as well as a degree in financial planning from a reputable college or university. From insurance professionals to bank managers, pretty much anyone can say they’re a financial planner. Pinpoint the exact qualifications now.
  3. Awareness of limitations. A stock broker who says she specializes in every aspect of investing is either lying or not very good at her job. Just like in any other career, brokers have specialties, whether securities or commodities or something else, so find out what it is and make sure it gels with your goals.
  4. Breakdown of cost. Your broker should clearly outline the costs associated with doing business with her. She may work on commission or she may impose a fee-only basis, but those percentages, commission structures and cost breakdowns should be made clear to you. In fact, they should be in writing.
  5. Good listener. A phone call isn’t enough to take in all your investment goals. You should be welcomed to an in-person meeting or series of conversations about what your goals are and how you can get there. Brokers who havegood listening, questioning and problem solving skills are who you want.

It can take a while to find the right stock broker for you, but don’t give up. If you choose unwisely and get burned later on, you’ll need a securities fraud lawyer. Thomas Law Group is here for you in the event this happens.

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