* Full-service
brokers: Full-service brokers usually charge higher commissions and
fees than discount brokers, but they also offer services that aren't
available be through discount brokers. Full-service brokerages offer
expert advice and good ideas that are especially helpful and needed when
the stock market is gyrating. Other services include ways of
establishing personal financial profiles, estate planning, and tax
advice.
* Discount and
online brokers: If you know what you want,
why not use a discount or online broker to purchase securities as
inexpensively as you can? Full-service discount brokerages like Charles
Schwab (the first discount brokerage) and TD Ameritrade have added a lot
of advisory and account-management services. The research available to
account holders is staggering, but each firm currently charges hefty
commissions for infrequent trades and a maintenance fee whenever your
account balance falls below a certain minimum. In contrast, discount
brokerage E*Trade still offers trades with low commissions and few
frills. However, you can't visit a branch office to talk to someone or
make a quick deposit.
* Buying mutual
funds: Mutual fund buyers have the choice
of purchasing a fund through a broker or purchasing a fund directly from
the fund company. Many brokerages offer only a limited number of funds
and may charge you a brokerage commission. However, if you buy a fund
that your brokerage owns and manages, the firm usually waives the
trading commission.