Which Is The Best Broker In Singapore?

Which trading platform is best in Singapore?


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What is the best stock trading platform in Singapore for 2020? ….  How To Choose The Best Online Broker in Singapore { 2020 } …


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To evaluate brokers, you should look at the following factors:

>>> Commissions
>>> Account Minimum
>>> Account Fees
>>> Your Trading Style and Tech Needs
>>> Promotions

Look at commissions on the investments you’ll use most… Brokers generally offer a similar menu of investment options: individual stocks, options, mutual funds, exchange-traded funds, and bonds. Some will also offer access to futures trading and forex (currency) trading.

The investments offered by the broker will dictate two things: whether your investment needs will be satisfied, and how much you’ll pay in commissions. Pay careful attention to the commissions associated with your preferred investments:

Individual stocks: You’ll typically pay a per-trade commission of $4 to $7. Some brokerages also offer per-share pricing.

Options: Options trades often incur the stock trade commission plus a per-contract fee, which usually runs $0.15 to $1.50. Some brokers charge only a commission or only a contract fee.

Mutual funds: Some brokers charge a fee to purchase mutual funds. You can limit mutual fund transaction costs or avoid them completely by selecting a broker that offers no-transaction-fee mutual funds. (Mutual funds also carry internal fees called expense ratios. These are charged not by the broker, but by the fund itself.)

ETFs: ETFs trade like a stock and are purchased for a share price, so they are often subject to the broker’s stock trade commission. But many brokers also offer a list of commission-free ETFs. If you plan to invest in ETFs, you should look for one of these brokers.

Bonds: You can purchase bond mutual funds and ETFs at no charge by using no-transaction-fee mutual funds and commission-free ETFs. Brokers may charge a fee to purchase individual bonds, with a minimum and maximum charge.

Pay attention to account minimums… You can find highly ranked brokers with no account minimum. But some brokers do require a minimum initial investment, and it can skew toward $500 or more. Many mutual funds also require similar minimum investments, which means even if you’re able to open a brokerage account with a small amount of money, it could be a struggle to actually invest it.

Watch out for account fees… You may not be able to avoid account fees completely, but you can certainly minimize them. Most brokers will charge a fee for transferring out funds or closing your account. If you’re transferring to another broker, that new company may offer to reimburse your transfer fees, at least up to a limit.

Most other fees can be sidestepped by simply choosing a broker that doesn’t charge them, or by opting out of services that cost extra. Common fees to watch out for include annual fees, inactivity fees, trading platform subscriptions and extra charges for research or data.

Consider your trading style and tech needs… If you’re a beginner investor, you probably won’t need extras, like an advanced trading platform. But you may want an education and a little hand-holding. This could include videos and tutorials on the broker’s website, or in-person seminars at branches. Many brokers offer these services free to account holders.

Active traders, on the other hand, will want to look for a brokerage that supports that kind of frequency. That includes weighing a broker’s trading platforms, analysis tools, research and data offerings in addition to commissions — including discounts for high-volume traders — and fees.

Plenty of high-quality online brokers offer free demo access to trading platforms.

Take advantage of promotions… Online brokers, like many companies, frequently entice new customers with deals, offering a number of commission-free trades or a cash bonus on certain deposit amounts.

It isn’t wise to choose a broker solely on its promotional offer — a high commission over the long term could easily wipe out any initial bonus or savings — but if you’re stuck between two options, a promotion may sway you one way or the other.


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◊ Best Stock Trading Platform In Singapore {2020} : Plus500 Review ◊


Plus500 is a streamlined broker that focuses on trading in a wide range of financial markets with relatively low spreads and no commissions but without offering many extra services. Plus500 has been in the forex and CFD business since 2008. They are registered in the U.K. and licensed by the Financial Conduct Authority (FCA).

The company offers access to a comprehensive product line including forex, stock indexes, equities, commodities, cryptocurrencies, ETFs and options. Plus500 is the first broker to introduce a bitcoin CFD in 2013. The company does not charge commissions on any of its trades.

All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500’s WebTrader platform. Plus500 Ltd. (PLUS.L) is a publicly traded company on the AIM section of the London Stock Exchange since 2013 with a £1.73 billion ($2.25 billion) market capitalization and clients in more than 50 countries around the world. Plus500 offers access to more than 2,000 trading instruments.


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Trust … The company is registered with the Financial Conduct Authority (FCA), CySEC, ASIC, FSCA, FMA, MAS, and the ISA, which provides good accountability and visibility. The company is required to take steps to ensure client funds are not comingled with corporate funds – ensuring that client money and assets are protected in the unlikely event that Plus500 becomes insolvent – by holding those funds in segregated accounts at regulated banks.

If Plus500 defaults, any shortfall of funds of up to £50,000 may be compensated for under the Financial Services Compensation Scheme (FSCS). If the custodian bank holding client funds goes into liquidation, any shortfall of funds of up to £85,000 may be compensated for under the FSCS.

Plus500 also offers Negative Balance Protection, ensuring that clients cannot lose more than they have put into their account. Guaranteed stop losses can be used on some instruments depending on market conditions but they are subject to a wider spread.

The company does not charge commissions on any of its trades. All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500’s WebTrader platform. Large volume traders do not get a trading discount at Plus500 and the spread is the same whether you trade one lot or 1,000 lots.

There are no charges for normal withdrawals or terminating an account. However, inactivity fees kick in after an account has been idle for three months. Beginning traders can open an account with as little as £100.

Traders can qualify for a “professional” account, which offers a higher level of maximum leverage, but the costs are the same. Investors with a professional account may increase their maximum leverage ten-fold, from 1:30 to 1:300.

Plus500 also offers access to options trading on many markets. These are very similar to plain call and put options traded on exchanges, but they are not standardized which means that the option premium can be customized for your risk tolerance and strategy objectives.


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Wall Street Tries To Recover From Massive Sell-Off

Stocks rose sharply on Monday in volatile trading as Wall Street attempted to pare losses incurred during the worst week since the financial crisis amid fears of the coronavirus outbreak.

The Dow Jones Industrial Average traded 576 points higher, or 2.3%. The S&P 500 and the Nasdaq Composite climbed 2% each.

“The market has been conditioned to buy on any weakness,” said Keith Buchanan, portfolio manager at GLOBALT. “I think we’ll look back at these past few years at some point as some level of complacency.”

“Buying the dip takes more bravery now,” Buchanan said.

Stocks briefly came off their highs after a key measure on the U.S. manufacturing showed a slowdown last month. The ISM manufacturing index fell to 50.1 in February, the lowest level since the end of 2019. It also came below an estimate of 50.8.

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Apple shares led the Dow higher with a 7% jump; Merck and Walmart gained 4.6% and 6.5%, respectively. Consumer staples, utilities and real estate were the best-performing S&P 500 sectors, advancing more than 3% each. Tech, meanwhile, jumped 2.9%.

Monday’s moves mirrored the volatile overnight session where Dow futures traded in a range of more than 1,000 points, indicating this week may be as volatile as last week as well.

The Dow, S&P 500, and Nasdaq Composite all fell more than 10% last week, their biggest weekly declines since October 2008. They also entered correction territory, down more than 10% from all-time highs notched earlier in February. Both the Dow and S&P 500 have fallen for seven straight days.

Those declines came after a sharp increase in coronavirus cases outside of China. The number of cases continued to increase over the weekend, including in the U.S.

“The outbreak of Covid-19 has certainly changed the near-term narrative,” said Chetan Ahya, global head of economics at Morgan Stanley, in a note to clients Sunday. “It is an untimely shock, considering that the starting point of global growth was weak, and the recovery was very nascent.”

As of Sunday, more than 89,000 cases have been confirmed around the world along with more than 3,000 virus-related deaths. Australia, Thailand and the U.S. reported over the weekend their first coronavirus-related deaths. Rhode Island was the first U.S. state on the East Coast to report a coronavirus case. The number of cases in England rose to 35 after 12 new cases were confirmed on Sunday. Cases in China also reported more than 500 new cases on Saturday. New York Gov. Andrew Cuomo confirmed Sunday night the state’s first positive coronavirus case.



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Horrible China economic data
Wall Street got its first look over the weekend at the economic toll the virus has taken on China, the epicenter of the outbreak.

A private survey on Chinese manufacturing activity released during Asian trading hours on Monday came in at its weakest level ever. The Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI) came in at 40.3 for February, far below expectations of a reading of 45.7 by economists in a Reuters poll. PMI readings above 50 indicate expansion, while those below that level signify a contraction.

That came after an official data released Saturday showed China’s official manufacturing PMI plunging to 35.7 in February, a record low, from 50 in January. A reading below 50 indicates contraction in a sector.

The plunge “shows the extent to which an outbreak can hit an economy,” said Ed Hyman, a widely followed economist on Wall Street and Evercore ISI chairman, in a note to clients. “All this is quite uncertain, and we may be overreacting. But we also don’t want to underreact.”

Gaming revenues in Macau also plunged nearly 88% last month.

Worries over the coronavirus’ impact on corporate profits and the global economy led investors to seek safer alternatives to stocks, pushing U.S. Treasury yields to all-time lows. On Sunday night, the benchmark 10-year rate broke below 1.04% for the first time ever. It was last at 1.07%.

“Global investors will be prone to panic as the virus arrives at their doorstep, underscoring the need for near-run prudence and patience before augmenting favored holdings,” strategists at MRB Partners wrote in a note. “The outlook is uncertain, or rather certainly bearish in the near term as quarantining spreads around the world, but with considerable doubt as to the duration and depth of the economic fallout.”

The virus’ quick spread has raised expectations for easier monetary policy from global central banks, including the Federal Reserve.

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CME Group’s FedWatch tool shows traders have priced in a 100% probability of a 50 basis-point rate cut later this month. Expectations for another rate cut in April are around 70%.

“The ultimate risk factor in our view is the U.S. consumer,” said Gregory Faranello, head of U.S. rates trading at AmeriVet Securities. “We have coronavirus cases showing up in the U.S. To the extent that that continues to spread, which we all hope will not be the case, the risk factor for the Fed grows because this now is no longer something that they can point the finger to relative to tariffs and say the global economy is slow, but we’re okay.”



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Precious Metals Enjoy Resurgence in Negative-Yield World


♦ Precious Metals – Stock Market News Today ♦ … – Gold purchases by everyone from central banks to retail buyers have boosted the metal to its highest level in six years, with a coterie of famous investors now touting its role as a haven from market turmoil. Silver and platinum have outpaced all other major asset classes so far in the third quarter, while palladium is up about 30% this year.


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The sudden interest in precious metals follows years of sideways trading as investors bet that steady growth would allow the world’s central banks to raise interest rates and end an era of miserly debt yields.

Instead, a deepening trade war between the U.S. and China has weighed on the outlook of nearly every major economy, adding pressure on many central banks to further cut rates—even those that already stand below zero.

Precious metals fell sharply Thursday as stocks and other risky investments rallied on hopes that coming trade talks will relieve some pressure on the world economy. Gold, silver and platinum each dipped 2% or more, trimming some of their sizable quarter-to-date gains.

Metall

While these nonyield-bearing assets struggle to compete with bonds when the outlook for the world economy is stable, their appeal has risen as negative rates have proliferated in Europe and Japan. It also has boosted interest in stocks that are expected to pay high dividends even when growth slows, such as shares of utilities and makers of consumer products.

“There is so much flight to safety right now and metals is where a lot of that money is going,” said Bob Haberkorn, senior commodities broker with RJO Futures in Chicago.

“Traders that had been out of the metals market are coming back…and there’s been a lot of buying from new accounts,” Mr. Haberkorn said. “It’s been great, great for business.”

Another factor boosting them this summer: falling yields and growth fears have dragged a long list of currencies, from the euro and British pound to the Chinese yuan, to their lowest levels in years. Unlike currencies, gold and other precious metals aren’t under the sway of any global central bank, further heightening their appeal.

Additionally, while stocks remain near records, a recent burst of market volatility has unsettled many investors. So has a steady world-wide decline in bond yields that many believe is a harbinger of weaker growth.

Although they rebounded Thursday, yields on the U.S. 10-year Treasury note dropped near a record low earlier in the week as disappointing manufacturing data and trade tensions pushed investors into government bonds and other safe assets. Yields fall as bond prices rise.

In Europe and Japan, some bond yields have been negative for years, and investors expect they will fall further as the European Central Bank and Bank of Japan unleash more monetary stimulus. More than $15 trillion in government debt around the world now has a negative yield, meaning essentially that savers holding these bonds are paying the government to store their money.

“Gold yields zero, but zero is still much better than negative,” said Bart Melek, head of commodity strategy at TD Securities.

Hedge funds and other speculative investors are wagering on further gains. They have pushed net bullish bets on gold to their highest level since 2006, as far back as Commodity Futures Trading Commission figures go. They also have lifted bullish wagers on platinum and silver, which both are on track for their best quarter in several years, according to Dow Jones Market Data.


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Their advance comes after years of tepid investor interest, particularly in platinum, which is used as a component in auto exhaust filters for diesel engines. Platinum prices had previously tumbled as environmental concerns cut demand for diesel vehicles across the world.

But the precious-metals rally spread to platinum in July, and prices logged their biggest weekly gain in eight years last week, advancing nearly 9%.

The gains have rippled to shares of companies that mine the metals, in part because mining stocks offer individual investors easier exposure to the sector than trading metals futures contracts.

The NYSE Arca Gold Miners Index is up about 40% this year, and shares of some smaller precious-metals producers have risen even more than that. Royal Gold Inc. is up 58% for the year, while First Majestic Silver Corp. has climbed 70%.

After an extended stretch of rangebound trading, the combination of falling rates and sluggish economic activity set up the sector’s rally this quarter, said Rhona O’Connell, head of market analysis for Europe, the Middle East, Africa and Asia at INTL FCStone.


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“It was looking a bit like a pressure cooker,” she said. “It’s a sharp move that becomes self-fulfilling because you get the momentum traders involved.”

U.S. Stocks Open Higher on Hopes for Trade Talks


◊ U.S. Stocks News Today ◊


♦ Stock Market News Today ♦ …U.S. stocks advanced Thursday amid renewed hopes for progress in the trade dispute between the U.S. and China.

The Dow Jones Industrial Average climbed 267 points, or 1.1%. The S&P 500 added 1%, led by gains in trade-sensitive industrial and material stocks. The technology-heavy Nasdaq Composite rose 1.3%.


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A batch of steady economic data and stronger-than-expected earnings reports from discount retailers helped ease some of the fears about slowing economic growth, as investors continued to weigh developments on the U.S.-China trade front.

Beijing hopes to prioritize discussions over removing the latest tariffs announced by President Trump last week, to prevent a further escalation of the trade war, Gao Feng, a spokesman for China’s Commerce Ministry, said Thursday.

The ministry said the U.S. needed to create the necessary conditions for trade negotiations to proceed, while noting that the countries remained in communication over possible talks in September.

Stocks have had a turbulent August amid renewed anxieties surrounding trade tensions, with all three major indexes down at least 2.2% this month. Still, all three are sitting within roughly 5% of their records. Shares of industrial conglomerates Caterpillar and Boeing climbed 2% and 1.3%, respectively.




“Any news around negotiations starting up or retaliations not happening are going to have a move in markets,” said Bert Colijn, senior eurozone economist at Dutch financial-services firm ING Group.

Investors were also sorting through a wash of economic data. U.S. gross domestic product—the broadest measure of the nation’s output of goods and services—rose at a seasonally adjusted annual rate of 2% in the second quarter, compared with the previous estimate of a 2.1% rise.

The government said consumers spent more than previously estimated in the April to June period, but the housing sector, exports and inventory investment were more of a drag than initially thought.

Meanwhile, U.S. jobless claims rose slightly to 215,000 last week, though the figure remains at a historically low level.

The yield on the 10-year U.S. Treasury climbed to 1.486% Thursday from 1.469% Wednesday, and the two-year Treasury yield edged up to 1.514% from 1.504% Wednesday, according to Tradeweb. Yields fall as bond prices rise.

In Thursday’s action, shares of Best Buy fell 5.1% after the consumer electronics retailer reported second-quarter sales that disappointed investors.

Discount retailers got a lift, with shares of Dollar Tree rising 2.5% on higher second-quarter sales and Dollar General shares gaining 7.2% on stronger-than-expected earnings.


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Meanwhile, the pound fell 0.2% against the U.S. dollar and the euro a day after U.K. Prime Minister Boris Johnson moved to suspend Parliament, a tactic aimed at stopping opposition lawmakers from blocking an abrupt break with the European Union.

Elsewhere, the Stoxx Europe 600 rose 1%. In Asia, the Shanghai Composite and Japan’s Nikkei both slipped 0.1%, while Hong Kong’s Hang Seng rose 0.3%.




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5 Stocks To Buy Today … { September 2019 }




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Investing for Beginners


{ Stock Market News Today – Investing for Beginners } … So you’ve decided to start investing?… Congratulations! Whether you’re just starting out on your own, in the middle of your career, approaching retirement age, or in the midst of your golden years, this means you’ve begun to think about your financial futureNobody starts out an expert, and even the best investors in the world were once sitting where you are.


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Let’s start with two basic questions: Where should you begin? … How do you begin? …
Those two inquiries might seem daunting, especially if you’ve encountered the array of intimidating investing terms — like price to earnings ratio (p/e ratio), market capitalization, and return on equity. But getting started with investing isn’t as scary as it might seem.

The First Investing Step Is Figuring Out Which Types of Assets You Want to Own
Let’s start with this basic truth: At its core, investing is about laying out money today with the expectation of getting more money back in the future — which, accounting for time, adjusting for risk, and factoring in inflation, results in a satisfactory compound annual growth rate, particularly as compared to standards considered a “good” investment.

That’s really it; the heart of the matter. You lay out cash or assets now, in the hope of more cash or assets returning to you tomorrow, or next year, or next decade. Most of the time, this is best achieved through the acquisition of productive assets.


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Productive assets are investments that internally throw off surplus money from some sort of activity. For example, if you buy a painting, it isn’t a productive asset. One hundred years from now, you’ll still only own the painting, which may or may not be worth more or less money. (You might, however, be able to convert it into a quasi-productive asset by opening a museum and charging admission to see it.)

On the other hand, if you buy an apartment building, you’ll not only have the building, but all of the cash it produces from rent and service income over that century. Even if the building were destroyed after a decade, you still have the cash flow from ten years of operation — which you could have used to support your lifestyle, given to charity, or reinvested into other opportunities.

Each type of productive asset has its own pros and cons, unique quirks, legal traditions, tax rules, and other relevant details. Broadly speaking, investments in productive assets can be divided into a handful of major categories. Let’s walk through the three most common kinds of investments: Stocks, bonds, and real estate.

Investing in Stocks
When people talk about investing in stocks, they usually mean investing in common stock, which is another way to describe business ownership, or business equity. When you own equity in a business, you are entitled to a share of the profit or losses generated by that company’s operating activity. On an aggregate basis, equities have historically been the most rewarding asset class for investors seeking to build wealth over time without using large amounts of leverage.

At the risk of oversimplifying, I like to think of business equity investments as coming in one of two flavors — privately held and publicly traded. Investing in Privately Held Businesses: These are businesses that have no public market for their shares.

When started from scratch, they can be a high-risk, high-reward proposition for the entrepreneur. You come up with an idea, you establish a business, you run that business so your expenses are less than your revenues, and you grow it over time, making sure you are not only being well-compensated for your time but that your capital, too, is being fairly treated by enjoying a good return in excess of what you could earn from a passive investment.

Though entrepreneurship is not easy, owning a good business can put food on your table, send your children to college, pay for your medical expenses, and allow you to retire in comfort.

Investing in Publicly Traded Businesses: Private businesses sometimes sell part of themselves to outside investors, in a process known as an Initial Public Offering, or IPO. When this happens, anyone can buy shares and become an owner.

The types of publicly traded stocks you own may differ based on a number of factors. For example, if you are the type of person that likes companies that are stable and gush cash flow for owners, you are probably going to be drawn to blue-chip stocks, and may even have an affinity for dividend investing, dividend growth investing, and value investing.

On the other hand, if you prefer a more aggressive portfolio allocation methodology, you might be drawn to investing in the stock of bad companies, because even a small increase in profitability could lead to a disproportionately large jump in the market price of the stock.


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Investing in Fixed-Income Securities (Bonds)
When you buy a fixed income security, you are really lending money to the bond issuer in exchange for interest income. There are a myriad of ways you can do it, from buying certificates of deposit and money markets to investing in corporate bonds, tax-free municipal bonds, and U.S. savings bonds.

As with stocks, many fixed-income securities are purchased through a brokerage account. Selecting your broker will require you to choose between either a discount or full-service model. When opening a new brokerage account, the minimum investment can vary, usually ranging from $500 to $1,000; often even lower for IRAs, or education accounts. Alternatively, you can work with a registered investment advisor or asset management company that operates on a fiduciary basis.

Investing in Real Estate
Real estate investing is nearly as old as mankind itself. There are several ways to make money investing in real estate, but it typically comes down to either developing something and selling it for a profit, or owning something and letting others use it in exchange for rent or lease payments. For a lot of investors, real estate has been a path to wealth because it more easily lends itself to using leverage.

This can be bad if the investment turns out to be a poor one, but, applied to the right investment, at the right price, and on the right terms, it can allow someone without a lot of net worth to rapidly accumulate resources, controlling a far larger asset base than he or she could otherwise afford.

Something that might be confusing for new investors is that real estate can also be traded like a stock. Usually, this happens through a corporation that qualifies as a real estate investment trust, or REIT. For example, you can invest in hotel REITs and collect your share of the revenue from guests checking into the hotels and resorts that make up the company’s portfolio.

There are many different kinds of REITs; apartment complex REITs, office building REITs, storage unit REITs, REITs that specialize in senior housing, and even parking garage REITs.

The Next Investing Step Is to Decide How You Want to Own Those Assets…  Once you’ve settled on the asset class you want to own, your next step is to decide how you are going to own it. To better understand this point, let’s look at business equity. If you decide you want a stake in a publicly traded business, do you want to own the shares outright, or through a pooled structure?

Outright Ownership: If you opt for outright ownership, you are going to be buying shares of individual companies directly. To do this right requires a certain level of knowledge.

To invest in stocks, think of them as you might your privately held businesses, and remember there are three ways you can make money investing in a stock. Plainly, this means focusing on the price you are paying relative to the risk-adjusted cash flows the asset is generating.

Discover how to calculate enterprise value, calculate the gross profit margin and operating profit margin, and compare them to other business in the same sector or industry. Read the income statement and balance sheet. Look at the asset management companies, which hold large stakes, to figure out the types of co-owners with which you are dealing.


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Pooled Ownership: An enormous percentage of ordinary investors do not invest in stocks directly but, instead, do it through a pooled mechanism, such as a mutual fund or an exchange-traded fund (ETF). You mix your money with other people and buy ownership in a number of companies through a shared structure or entity.

These pooled mechanisms can take many forms. Some wealthy investors invest in hedge funds, but most individual investors will opt for vehicles like exchange-traded funds and index funds, which make it possible to buy diversified portfolios at much cheaper rates than they could have afforded on their own. The downside is a near total loss of control. If you invest in an ETF or mutual fund, you are along for the ride, outsourcing your decisions to a small group of people with the power to change your allocation.

The Third Investing Step Is Deciding Where You Want to Hold Those Assets… After you’ve decided the way you want to acquire your investment assets, your next decision regards where those investments will be held. This decision can have a major impact on how your investments are taxed, so it’s not a decision to be made lightly. Your choices include taxable brokerage accounts, Traditional IRAs, Roth IRAs, Simple IRAs, SEP-IRA, and maybe even family limited partnerships (which can have some estate tax and gift tax planning benefits if implemented correctly).

Let’s briefly look at some of the broad categories.

Taxable Accounts: If you opt for a taxable account, such as a brokerage account, you will pay taxes along the way, but your money is not nearly as restricted. You can spend it however you want, at any time. You can cash it all in and buy a beach house. You can add as much as you desire to it each year, without limit. It is the ultimate in flexibility but you have to give Uncle Sam his cut.

Tax Shelters: Retirement plans like 401(k)s or Roth IRAs offer numerous tax benefits. Some are tax-deferred, which (usually) means you get a tax deduction at the time you deposit the capital into the account, and then pay taxes in the future, allowing you year after year of tax-deferred growth. Others are tax-free, meaning you fund them with after-tax dollars (read: you don’t get a tax deduction), but you’ll never pay taxes on either the investment profits generated within the account nor on the money once you withdraw it later in life. Good tax planning, especially early in your career, can mean a lot of extra wealth down the road as the benefits compound upon themselves.

Some retirement plans and accounts also have asset protection benefits. For instance, some have unlimited bankruptcy protection, meaning that if you suffer a medical disaster or some other event that wipes out your personal balance sheet and forces you to declare bankruptcy, your retirement savings will be out of the reach of creditors. Others have limitations on the asset protection afforded to them, but still reach into the seven-figures.

Trusts or Other Asset Protection Mechanisms: Another way to hold your investments is through entities or structures such as trust funds. There are some major planning and asset protection benefits of using these special ownership methods, especially if you want to restrict how your capital is used in some way. And if you have a lot of operating assets or real estate investments, you may want to speak to your attorney about setting up a holding company.

An Example of How a New Investor Might Start Investing… With the framework out of the way, let’s look at how a new investor might actually start investing.

First, assuming you’re not self-employed, the best course of action is probably going to be to sign up for a 401(k), 403(b), or other employer-sponsored retirement plans as quickly as possible. Most employers offer some sort of matching money up to a certain limit.

For example, if your employer offers a 100 percent match on the first 3 percent of salary, and you earn $50,000 per year, that means on the first $1,500 you have withheld from your paycheck and put into your retirement account, your employer will deposit into your retirement account an additional $1,500 in tax-free money.


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Whether or not your employer offers matching, though, you’ll need to invest the money you put in the account. Your 401(k) will probably have a default option, but choose the mutual funds or other investment vehicles that make the most sense for your future needs. As money gets automatically added to your account with each paycheck, it will be put toward that investment.

Next, assuming you fall under the income limit eligibility requirements, you’ll probably want to fund a Roth IRA up to the maximum contribution limits permissible. That is $5,500 for someone who is younger than 50 years old, and $6,500 for someone who is older than 50 years old ($5,500 base contribution + $1,000 catch-up contribution).

If you are married, in most cases, you can each fund your own Roth IRA. Just make sure you invest the money you put in there — by default, IRA providers will park your money in a safe, low-return vehicle like a money market fund until you direct them otherwise, so decide on which mutual funds, ETFs, or other investments you want to put your money toward.


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Once you’ve taken care of such personal finance essentials as funding an emergency fund and paying off debt, you’d want to return to your 401(k) and fund the remainder (beyond the matching limit you already funded) to whatever overall limit you are allowed to take advantage of that year.

With that done, you might begin to add taxable investments to your brokerage accounts, perhaps participate in direct stock purchase plans, acquire real estate, and fund other opportunities. Done correctly over a long career and with the investments managed prudently, it could increase your odds of retiring comfortably drastically.