Whats a Brokerage Firm?
In the same way you need a bank to store your money, you need a brokerage firm in order to invest it. Brokerage firms are where you keep stocks, bonds, mutual funds, and retirement accounts. Picking a brokerage firm is, in many ways, less consequential than picking a bank. Most of us don’t interact with our brokerage firm every day – or even every month. Still, there are all sorts of ways that picking the wrong brokerage firm can cost you. The companies that will help you invest fall into a few different categories (though they’ve bled together somewhat in the last decade or so). 1.) Traditional brokerage firms (e.g., Merrill Lynch, Smith Barney, etc.): These are the firms that have been around for decades and, in the old days, used to pair you up with a man (always a man) in a suit (always a suit) to help you pick stocks. For this privilege, you’d pay a fat commission every time you moved your money. In a recent (and unfortunate) development, the old-fashioned brokers are pushing peop
