How To Buy Stocks Online For Beginners

How To Buy Stocks Online

It is easy to learn how to buy stocks online and I will show you how

WHY I USE E*TRADE AS MY ONLINE DISCOUNT BROKER


I have stock accounts at 3 different brokers (Merrill Lynch, E*Trade, and TD Ameritrade) and I must say that my favorite by far is E*Trade. Why do I have three different accounts? My Merrill Lynch account was set up for me in the 80′s by my father, my E*Trade account was set up as my first online account about 10 years ago, and I set up my own account at TD Ameritrade last year just to try them out after reading the great reviews they got. But in the end, E*Trade is still my favorite.

At the time I put my first dollars in E*Trade, they were one of the pioneers of online brokers and I felt they probably knew what they were doing more than anyone else. The online investing world was relatively new and I wanted to go with one of the leaders. They still are a leader today and I have never regretted it.

Price

I get all my stock trades for $9.99 and while I can get cheaper trades elsewhere, it is just not worth it to me to change because I don’t trade too often. Their price has always been $9.99 as long as I can remember and I get good value for that because I LOVE their website and how easy it is to navigate.

Website Usability

When you are choosing between E*Trade and other online brokers, you will find that one of the biggest differences between all of them is their platform website. For instance, I absolutely hate my Ameriprise account because their website is NOT user friendly. I can never figure out how to get from one place to another and I don’t like the way they display things. It’s like Ameriprise hasn’t thought about how best to present the account information and they have never changed anything to make it better.

E*Trade on the other hand, is a dream to navigate and it takes very little time to figure out where everything is. When you first log on, it will have your account(s) displayed right in front of you and all you have to do is click on them to take you to a screen that will show you every stock in your portfolio. You will immediately see how much each of your stocks went up or down for the day along with some other basic information. Everything about their website is simple and “user friendly” which is just the way it should be.

Account Safety

One thing I REALLY like about E*Trade is the feeling of security I get knowing that it is virtually impossible for someone to log in to my account. With every account you get an optional FREE digital security ID (see picture below) and you use it to access your account. The number on the ID changes every 60 seconds and you have to add that number on to your password to get into your account. You also get optional SmartAlerts that you set up to automatically inform you of any account activity. Bottom line: I know my online account is super safe because no normal person will be able to hack into my account without some super hacking ability.

 

Real Offices In Many Cities

Another thing I like about E*Trade is that they are big enough (publicly traded on Nasdaq – symbol ETFC) to have real offices in many major cities. Unlike some of the discount brokers that only have websites, they have a brick and mortar office in my city and I went there a couple of times when I wanted to add money to my account. I was able to hand a check directly to a broker and talk to him as well.

You can of course add money to your account by mail, wire, or electronic transfer but I like the fact that I have somewhere to go if I have any real problem or complaints. I have also dealt with them on the phone from time to time regarding account issues and always found their customer service to be great. They even have online customer service chat so you always know someone is there 24/7.

Research, Investing, and Trading Tools

Once you open an account you will have access to a full array of research tools that rival that of any online broker. I don’t personally use them too often but you probably will find all you need. Every stock you look up will have a section for analyst research, fundamentals, earnings (complete with graphs) and a section listing insider activity.

With E*Trade you also get a section that has about 25 videos covering different online investment topics. There are also periodic live web seminars that you have to sign up for that do NOT cost anything extra.

If you think you will want to be buying stocks on any of your mobile devices there are apps for the iPad, iPhone, Android, and Blackberry that allow you to trade on the go.

Bottom Line

E*Trade is one of the original online discount brokers that started the whole website stock trading revolution. In my opinion they have the most solid website experience and that is extremely important to me as I do log on to my account just about every day to see how my stocks fared. I feel confident having my money with them because of the responsive customer service I have always gotten and their price is right in line with most everyone else. Right now E*Trade is offering free trades for the first 60 days if you are a new customer plus up to $600 dollars if you put in qualifying amounts so it is a good time to give them a try!

ARE YOU ONE OF THE 50% THAT DOESN’T OWN STOCKS?



One of the things President Obama often talks about when defending his record is the soaring stock market. In 2009 when he took office the Dow was in the low 7.000′s and now it is over 18,000. The NASDAQ was around 1.700 and now it is all the way up over 5,000. These are absolutely HUGE gains for anyone who owns stocks!

But the big problem is (according to a Bankrate.com survey), that less than 50% of Americans have any money in the stock market and those people have nothing to show for the “growing” economy the politicians so often talk about. That is why it is extremely important for people of all ages to get educated and learn about stocks.

Predictably, the biggest reason people don’t buy stocks is that they have no savings which is a strong indication that the economy isn’t doing very well at all. While jobs may be growing, too many of them are low paying minimum wage work and people can’t save any money with those. Unfortunately, like the President, I have no idea how to reverse that trend.

The other reasons on the chart though, all involve people’s ignorance about the the stock market. They just don’t know about it, don’t understand it, are afraid of it, or don’t care about it and in the end those are the people who suffer. Learning how to invest your money is crucial if you want to have any chance of living a comfortable retirement. Every high school should have an introductory class to financial planning which includes familiarizing students with the stock market!

You can get started with as little as $2,000 with most brokers and $500 with a select few. That is not exactly life changing money and most people should be able to scrape that together at some point. Unfortunately though, just opening their first online discount broker account and being willing to learn is what stumps most people. They just never take the initiative and end up missing what is the best way to grow your savings over a lifetime. Buying and selling stocks is not really that hard even though all the jargon you hear makes it seem intimidating.

About 50% of Americans have participated in this stock rally that has lasted more than 6 years and I’m sure they are feeling fortunate to have done so. With interest rates near 0%, where else are you going to make money? That is the huge problem for the other 50% that have no stocks and have no way of keeping up with the other half.

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