With any research I have done on google, people will explain investing with the assumption that people have a basic understanding on the different types of financial systems. *I don’t*. With a brokerage account, do I just put the money in and let it sit to accrue interest, or do I need to do anything else?
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A brokerage account is an account held by a “stock broker” or trading house. A bank account is an account held by a bank. Banks can also be brokerages (which can also be called an investment bank).
There are different brokerage accounts (margin, equities, options, commodities, futures etc) like there are different bank accounts (checking, saving, money market etc). And those different accounts allow you to do different things at the institution holding your money.
Given your question, you really shouldn’t have a brokerage account unless it is being managed by a qualified team (like in a company sponsored 401K). If you wish to buy on you own you may want to look into things that are managed for you like a mutual fund. But you should not have your money just stilling in a brokerage account. It will lose value given inflation. You are better off in some investment vehicle like a money market or CD.
If you have enough money or income you should speak with a financial advisor, if you don’t really qualify for a financial advisor, speak with the investment representative for your bank, they can help you start to build your wealth.
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