Investing in the stock market can be expensive depending on what route the investor takes. Finding the cheapest way to invest in the stock market is essential at any level of trading.
If they are paying too much in fees it will eat up some (or all) of their potential profits.
That is why an investor that wants to save money must research all of their options. There are many ways to obtain the ownership of stocks, but not all of them are at the same price.
Stock Brokers
While stock brokers can give an investor great advice, they can also bite into a lot of their profits.
Different stock brokers will charge different amounts for fees and commissions.
If the investor does not have a lot of stock market experience, they might want to start out by using a stock broker. Then they can start making investments on their own without having to pay so much in commissions.
By meeting with different stock brokers, an investor can get a good feel of what the average charge to invest with them would be. They also will want to factor in how much the stock broker usually returns. If the return is too small, it could be pointless to invest with them at all.
Cheapest Way to Invest in The Stock Market – Online
The internet has countless opportunities, and investing in the stock market is one of them.
Finding an online stock trading website can be much cheaper than using a stock broker. This is because most of these websites will not charge the investor on how much profit they make.
Many stock brokers will take their commission on how large of a return they have made.
Different stock trading websites will charge different amounts for fees, so it is important that they comparison shop. While one stock trading website might be geared towards options traders, another could be better for a long term investor.
My personal favorite is Interactive Brokers (This is not an affiliate link – I have no affiliation with them besides being a customer). I’ve researched them all extensively and have tried several, but none can beat IB. There fees are abysmally small, and the program is super intuitive to use.
Employee stock programs
Many companies that are publicly traded will offer their employees a stock program. Depending on the employer will depend on the stock program they can choose from.
Some employers will deduct a set amount of money from the employee’s paycheck and invest in their stock without any fees.
Other employers might offer the stock for a discounted price or even give them stock options.
Stock options can really help the employee with their investment if they currently own a lot of shares with the company. But even if they do not, they can still have the opportunity to sell their stock options for a great return. The direction a stock moves, and the amount of time it takes, will determine what they can sell their stock options for.
I hope these tips have helped you find the cheapest way to invest in the stock market to suit your personal needs! If you have any questions about different trading platforms, feel free to ask in the comments below.