How much does it cost to trade stocks?
These days, it should be less than $10. If you’re going to be trading a lot, you should be trying to pay even less than that.

How many mutual funds can I trade for free – and what does it cost to buy and sell the other ones?
Many brokerage firms have fund supermarkets of various sorts, with hundreds of mutual funds that customers can trade without paying any commissions. If a firm you’re considering has no such list, ask what it will cost to buy and sell mutual funds under various circumstances (buying 10 shares or buying 1,000; does selling have different prices; does it depend on the fund; etc.).

Are there any fees for having too low of a balance?
There may be account maintenance fees for customers with low balances. Sometimes, you can avoid these by doing your banking with the firm too, or agreeing to invest money automatically each month.

Am I not allowed to meet with anyone in person if my balance is too low?
Old-fashioned stockbrokers like Merrill Lynch have been requesting that people who have $100,000 or less in their accounts call 800 numbers for support. The firm would rather its exalted brokers not bother with the riff-raff. Apparently, the firm doesn’t care that small accounts often grow into giant ones. If this is the sort of company you’d like to do business with, be our guest. But we wouldn’t advise it.

What special privileges are there for having more than a certain amount of money invested with you?
At Merrill, you’d get to talk to a real live human in person! Seriously, though, there’s nothing wrong with giving better service and pricing to your best customers. Those with bigger balances may get access to mutual funds with lower fees (at Vanguard) or money-market funds with higher rates (Schwab). You might get free advice once per year, or access to special phone lines.

What sort of research tools do you offer?
At the old-fashioned firms, they still employ dedicated research analysts to make buy and sell calls on specific stocks or mutual funds. The discount brokers, meanwhile, have all sorts of online tools to help you pick stocks and funds on your own. If this is important to you, ask for a complete list of everything available before you open an account.

Where do you put the cash in my portfolio?
If your stocks or funds pay off dividends, or if you sell some shares but don’t specifically allocate the proceeds of the sale, your broker will likely sweep your money into some kind of money-market account. How much will that account earn? Often, far less than the best money-market accounts normally pay.

This is an obnoxious way for brokerage firms to soak you, and lots of them do it. Find out if yours is one of them and make sure your idle cash ends up somewhere appropriate, namely one of the highest-yielding money-market accounts.

Can you help me manage my portfolio and, if so, what does the advice cost?
Every firm offers a range of advice and charges you for it in all sorts of ways. Ask for a list of all your options, with prices. In many cases, you may be better off simply using a financial planner – someone with no vested interest in you keeping your money at a particular firm or with a particular mutual-fund family.

For more on the business of giving financial advice, see our financial planning guide.

Want to Know More?

• What's a Brokerage Firm?
• Do You Need A Broker?
• Advice on Choosing a Brokerage Firm