Stock Brokers -- Just The Facts
Most of the buying and selling on the stock market is handled by stock brokers on behalf of their clients, who are the investors. Many different types of brokerage services are available.
Full-Service Brokers
"Full-service brokers" offer a variety of ways to help clients meet their investment goals. These brokers can give advice about which stocks to buy and sell, and often have large research departments that analyze market trends and predict stock movements, for their clients.
Such services are not free, of course. Full-service brokers charge the highest commission rates in the industry. Your decision whether to use a full-service broker will depend on your level of self-confidence, your knowledge of the stock market, and the number of trades you make regularly.
Discount Brokers
Investors who wish to save on commission fees generally use discount brokers. Brokers in this category charge much lower commissions, but they don't offer advice or analysis. Investors who prefer to make their own trading decisions, and those who trade often rely on discount brokers for their transactions.
Online Brokers
Taking the discount concept 1 step further, online brokers are the least expensive way to trade stocks. Both full-service and discount brokers usually offer discounts for orders placed online. Some brokers operate exclusively online, and they offer the best rates of all.
Account Requirements
Whichever type of broker you choose, your first order of business will be to open an account. Minimum balance requirements vary among brokers, but it is usually between $500 and $1000. If you're shopping for a broker, read the fine print about all the fees involved. You'll find that some brokers charge an annual maintenance fee while others charge fees whenever your account balance falls below a minimum.
Cash Or Margin?
Brokerage accounts come in 2 basic types. The "cash account" offers no credit; when you buy, you pay the full stock price. With a "margin account," on the other hand, you can buy stock on margin, meaning the brokerage will carry some of the cost. The amount of margin varies from broker to broker, but the margin must be covered by the value of the client's portfolio.
Any time a portfolio falls below a specified value, the investor will have to add funds or sell some stock. A greater opportunity exists for realizing gains (and losses) with margin accounts, because they allow investors to buy more stock with less cash. Involving greater risk than cash accounts, as they do, margin accounts are not recommended for inexperienced traders.
Selecting The Right Broker For You
You should carefully consider your needs as an investor before making the choice of a broker. Do you wish to receive advice about which stocks to buy? Are you uncomfortable making trades on the Internet? If so, you will be best served by a full-service broker. If you are comfortable buying on the Internet, and you have the knowledge and confidence to make your own trading decisions, then you will be better off with an online discount broker.
After deciding which type of broker you want, do some comparison-shopping between competitors. Significant cost differences can show up when you factor in all the annual fees and brokerage rates. Estimate how many trades you expect to make in a year, how much cash you can deposit into your account, whether you want to use margin accounts, and which services you need. Armed with this information, you'll be prepared to compare your actual costs for various brokers, and to make an educated choice.
Visit Stock Trade to learn more. Ron King is a full-time researcher, writer, and web developer. Copyright 2005 Ron King. This article may be reprinted if the resource box is left intact.
CONNECTING WITH YOUR UNCLAIMED MONEY
Unless you won the lottery this week you would probably be excited to find money owed to you. Unclaimed money and property in excess of $25 Billion is being held by the government and is just waiting to be claimed.
You may be thinking, 'I have never forgotten about money owed to me', this may be true, but what about the monies you are not aware of? i.e. an inheritance or savings bond. Oprah Winfrey stated 9 out of 10 Americans have unclaimed money.
So why is this money just sitting around? Chances are you haven't heard about unclaimed money, there is a lack public awareness and no simple method for searching and claiming lost funds.
The most common types of Unclaimed Property are:
· Savings and checking accounts and safe deposit box contents
· Stocks, mutual funds, bonds, and dividends
· Uncashed cashier's checks or money orders
· IRS refunds
· Wages, child support payments
· Matured or terminated insurance policies
· Estates
· Mineral interests and royalty payments, trust funds, and escrow accounts
· The list goes on and on...
One of the most impressive unclaimed items is a 88-carat natural blue sapphire ring valued at over $25,000! Recently a widow found over $50,000 owed to her from an account her deceased husband had opened that she was not even aware existed.
The property ends up in government accounts due to laws requiring the property to be turned over to the state or other governing agency after a period of approximately 3 years without contact from the owner.
Oftentimes the owner moves and does not leave a forwarding address or forgets that the account exists. In some cases, the owner dies and the heirs have no knowledge of the property.
The amount of unclaimed cash is growing. It has almost doubled the 15.8 billion in lost funds recorded in 2000. The increase is not only due to public awareness but also attributed to each state recording the money in individual databases.
Finding Your Unclaimed Money
So how do you search and find money owed to you? Each state has its own database but it is not enough to search only the state where you reside. If you have conducted business with companies outside the state, the funds may be reported in the state where the business was located. Also, a state search will not locate missing money in 90 federal databases. This makes searching difficult because you may have unclaimed cash in a state in which you have never lived.
You also need to search variations of your name. For example, if your name is Michael James Anderson an account might be under M Anderson, M J Anderson, or Michael Anderson.
This can be a time consuming and tedious process to locate and search over 120 databases. The most comprehensive government site only incorporates 14 states into its database. This search would still produce incomplete results and you may miss money owed to you.
Comprehensive Unclaimed Money Searches
It is worth the small fee to utilize a private site that has compiled all state and government databases.
After you have completed your search by name you will be given results from the database. It may contain multiple records, some of which are not yours. The record will normally have details on the property, the value, institution the funds originated from, owner address, etc. You should be able to tell which accounts are yours from a quick look at these details.
What to do when you find the money
After locating your missing money follow the directions to submit the claim. The claim process varies slightly depending on the type of account or state of claim. Usually the claim consists of filling out and sending a form or affidavit and copies of identification or documents relating to the account.
Through continued efforts to educate the public on the topic of unclaimed money more and more Americans are finding their lost funds. Over $1 Billion was returned last year. It is likely you or your immediate family members have unclaimed money or property. Now that you are aware it exists and know how to find and claim it, you can search for what is owed to you!
About The Author:
Nicole Anderson offers more information about unclaimed money at www.cashunclaimed.com. This site is a compilation of all state and federal databases and searches name variations with each search.
How to minimize your taxes on wealth
Taxes on wealth or simply wealth tax is the tax levied on the value of wealth owned by a person. As the term 'wealth' carries with it a broader meaning, generally capital transfer taxes (which include inheritance tax and gift tax), property tax, and capital gains taxes are some times invariably referred to as wealth taxes.
Taxes on wealth were first introduced in Europe, aimed at reducing the growing wealth gap between the rich and the poor. It was meant to raise revenue for addressing pressing social requirements and also to discourage the attitude towards amassing wealth.
Still, in countries across the world, majority of wealth is concentrated at the hands of fairly small number of people. Ideally taxes on wealth cuts down the disparities in wealth rather than the income, which actually is the determinant factor on how the scales are weighed for the next generations.
Also, taxes on wealth can bring about vertical as well as horizontal equity, which income tax fails to achieve. For example, neither a wealthy person nor a poor one with no income will pay income tax. But the wealthy ones need to cough up wealth tax while the poor need not.
But, as critics puts down, taxes on wealth can actually cause inefficiency by discouraging wealth producing economic initiatives. Also, the revenue generated by imposing taxes on wealth may not be that productive as the theory suggests. The wealthiest form only a small percentage of the population and by nature they are adept at avoiding taxes while remaining themselves within the contours of law.
Taxes on wealth comes in two forms – the capital transfer taxes that are levied when wealth change hands and the annual wealth taxes. Capital transfer taxes can occur either at death – also called inheritance tax – or via donation (gift tax). Some people tend to believe that Capital Gains tax to be a form of taxes on wealth. But in realty, capital gains tax is the taxation on the income obtained on capital and not a wealth tax on the capital.
Ideally, taxes on wealth should not be severe on the tax payers even if they have lots of wealth. Instead, after the minimum slab of no taxation, the taxes on wealth percentage should increase at increments, depending on the value of wealth in dollars. Such a fairer taxation not only increases the revenue but also goes a long way in bringing down the inequality aspect as well.
But with intelligent investing, one can save a lot that other wise goes as wealth tax. But that requires careful thought and advanced planning. May be a tax professional could help one in this regard.
Jakob Jelling is the founder of http://www.cashbazar.com. Visit his website for the latest on personal finance, debt elimination, budgeting, credit cards and real estate.
