It’s important for everyone to have savings and retirement plans in place. Our most productive years are also the years where we spend the most money, so squirreling away a percentage of our earnings to savings and retirement plans is essential. Within that broad framework are many different investment options.
You could delve into mutual funds, ETFs, individual stocks, commodities, futures markets, treasuries, etc. The possibilities are endless. Here’s where things get a little tricky: how do you know where to trade, what to invest in, and how much you should be paying for these services?
Some brokerages charge more than others for the similar services. Over the years you’ll discover a huge amount you paid towards the fees alone. It’s essential that you look for ways to reduce trading cost while looking to maximize your trading profits.
Following are some ways to reduce your trading cost
Cost Considerations at Leading Brokers
When it comes to online brokerages for stock trading, there are many options available. You could go with one of the bigger brokerages with a national or international presence and land-based facilities, or you could go for a lower cost and credible alternative like Saxon Trade.
It’s important to evaluate each broker on its merits. At the end of the day, it boils down to personal preferences. You may be okay paying a little more to make your trades and investments by going with a brand name broker. Peace of mind is an important part of the deal when investing money with any broker.
Remember that it’s not simply the ability to buy or sell financial assets that matter – it’s the peripheral services offered by the broker. These include the accuracy, reliability, and relevance of educational resources, market insights, technical and fundamental analysis, etc.
There is no dollar figure that can be placed on this information. It can make or break the outcomes of your trading decisions and the value of your financial portfolio. When evaluating a broker on costs alone, remember to look beyond the nominal fee per trade, or the monthly maintenance fees.
What Are Some of the Most Important Aspects of Online Brokers?
Building a viable financial portfolio is a serious commitment to your future and the broker that you’re trading with. You will always want to go with brokers that do not charge you inactivity fees because your financial fortunes will fluctuate over the years.
Likewise, you do not want to go with a broker that requires a fixed account minimum at all times. The quality of the trading platform is paramount.
Trading platforms that respond rapidly to call options, put options, market updates and real-time market data are best. Stock analysis is also something that needs careful scrutiny.
Extensive market research can be especially beneficial to novices, intermediate-level traders, and experts looking for relevant information on assets and their likely performance.
Low commissions and the widest possible range of investment options should always factor into the decision-making process.
There are also peripheral issues like funding options. When money needs to be transferred from accounts abroad to your retirement accounts, you don’t want to be paying high foreign exchange rate fees, money transfer services costs, and commissions.
That’s why it’s important to view your retirement portfolio holistically. Every time $1 moves from point A to point B, a fraction of it is eroded away.
Digital money transfers are increasingly popular ways to reduce the erosive effects that traditional banks have on money transfers to retirement accounts from abroad.
For example, an investor with resources in Asia may sell those resources or repatriate profits from Asia to Europe, or the US for retirement planning purposes. It’s important that exchange-rate regulations do not eat away at the money before it has had time to be put to use.
FinTech technology has rapidly evolved to make it possible for low-cost money transfers on a global scale.
Never Take your Eyes off the Prize
All in all, you will want to watch every $1 from inception to investment and beyond.
Never take your eyes off the prize when you are investing hard-earned money for your retirement, or simply for savings purposes. Money needs to be managed, and nobody knows the value of your money more than you do.
Readers, in the past, how did you reduce your trading cost? Do share your opinions.