After you decide what type of investment is right for you, there’s still a chance to save money and therefore increase your payout. Always check the fees associated with buying, selling, or holding an investment.
If you are going to buy stocks on your own, aim for a low-cost per trade online broker like ETrade.com (voted #1 online broker by SmartMoney), Scottrade.com, or Ameritrade.com which offer big discounts versus traditional brokers. These sites offer a range of self-service resources to guide your investment decisions.
If you are buying mutual funds, look for low management fees (fees are always disclosed). Don’t be misled by the fact that you may not be writing a separate check to pay those fees. They are coming out of your return which means you are effectively paying them by earning less.
If you are buying into a stock index, go for an ETF (the stock equivalent of an index, like QQQ for the Nasdaq index) or index funds instead of managed funds. Instead of paying yearly management fees you’ll just have to pay for the stock trade to buy and sell. Buy these through a discount broker like E*Trade to really minimize your costs.
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A LOZO expert posted this tip. |