Should you change to a different brokerage firm in the new year?
Investing your money can help you build wealth, but you want to pick the right place to put your dollars. That doesn't just mean picking the right assets, but also the best brokerage firm to facilitate the investing process.
There's a huge number of different brokers out there, each offering their own unique features. Unfortunately, far too many people just stick with the one they started with and don't take the time to compare all their options. If this sounds like it might be your situation, be on the lookout for these four signs that it's time to switch brokers in 2021.
1. You're still paying commissions
Traditionally, brokers charged commission to buy and sell stocks. However, virtually all good discount online brokers have done away with this unnecessary fee that eats into your returns.
If you still have to pay to make investments, this is a major sign that it's time to make a change. Many brokerage firms don't charge fees for trading -- including well-established big-name players -- so there's no excuse for paying commission fees.
2. You have limited investment options
You shouldn't be limited in your investment choices because your broker is too restrictive in the options available to you.
You should be able to buy stocks on U.S. exchanges, obviously, but you may also want a brokerage firm offering a good mix of ETFs, mutual funds, and options. Fractional shares may also be a great addition to your portfolio as they open the door to buying stock in companies with high share prices. And some brokerages even offer the option to add alternative investments to your portfolio, such as cryptocurrency.
If you find yourself wishing your brokerage had more investment choices, make a change so your efforts to build your portfolio aren't limited by its shortcomings.
3. The mobile experience is lacking
Being able to manage your portfolio from your phone or tablet can be especially important as you may want to make trades when you aren't on your laptop or computer. If your brokerage has a mobile app that's very limited or that's hard to navigate, this alone may be reason to find a different one that makes account management easy from any device.
4. Your brokerage doesn't offer all the account types you need
There are many investment account types you could put your money into, including taxable brokerage accounts, Solo 401(k)s, 529 savings accounts, various types of IRAs, and custodial accounts, among others.
Not all brokers offer access to all of these account types. While you could spread your money across different brokers, that just makes it harder to manage everything -- and to make sure your portfolio remains diversified.
If you find yourself unable to open one of the accounts you desire with your current broker, think about switching to one that makes it easy for you to keep all your investments in the same place.
The start of a new year is a great time to look into alternatives and find a brokerage that's a better fit if one or more of these problems applies to you. Take action soon, so you don't find yourself ending 2021 with the same dissatisfying broker you were working with at the start of the year.
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