5 Signs of a Good Broker

5 Signs of a Good Broker

Are you on the lookout for a stock broker to handle your investment plans? Retirement may seem like a far-off prospect now, but nurturing, maintaining and adding to your nest egg will ensure many comfortable golden years. Choosing the right broker means putting in the time to do your research. After all, this professional will have access to all of your financial assets and will be privy to information even your spouse may not even know about.

Treat your stock broker search like finding a mate: trust, transparency, and compatibility all come into the equation. Here are five signs of a good stock broker:

  1. In your search for a qualified professional, look into your stock broker’s background for details about education, experience and years in the industry. You also want someone who has the necessary licenses and registrations under their belt, along with a degree in financial planning from a reputable college or university. The cold hard truth is that anyone can say they’re a financial planner, from insurance professionals to bank managers to the guy in your neighborhood who dabbles in day trading. Doing your research now to find out the exact qualifications will save you headaches later.
  2. Knowing their limits. A stock broker who pretends to know everything about everything is just plain lying. Everyone – even stock brokers – have their strengths. Look into their background and ask questions about what they specialize in. Some are great attax law, while others corner the market in estate planning.
  3. A stock broker who sticks with his clients through thick and thin to truly follow through on a plan of lifelong investment is a good broker. You want someone who is generally concerned about your long-term goals and how you achieve them, rather than someone who’s just in it for the commissions or won’t hesitate to drop you when you get too conservative.
  4. Active listening. No stock broker can determine your financial goals in the course of one phone call. This takes an in-person meeting or even a series of conversations about what you want to achieve and how you can best go about it. If a broker asks you leading questions or tries to throw you a sales pitch, move on. You can’t waste the time on selling tactics. Instead, focus on those who have excellent listening, questioning and problem solving skills.
  5. Clear on cost. You want a broker who clearly outlines the costs associated with doing business with him. Whether the broker works on a commission basis or fee-only basis, those percentages, commission structures and cost breakdowns should be made clear, in writing. Run the other way if you can’t nail down specifics from your broker.

Settling on the right fit for your stock broker may take a lot of trial and error. Don’t be rushed; this process takes time. The last thing you want is to choose unwisely and get burned by your broker later on. This is a great reason to always keep the number of a securities fraud lawyer handy. Thomas Law Group is here for you should you require a professional who can recover your losses.