Extract from CBS News MoneyWatch. Written By MONEYWATCH
"You and your broker (or financial consultant or insurance agent) - or STOCKBROKER have different interests. They have to sell things to make a living. The more they sell, and the more expensive the products, the better off they'll be. Like any other salesperson - for shoes, cameras, advertising or high-tech medical devices - moving products is their job. Your job, as a customer, is to look skeptically at those products, ask yourself if you need them, compare them with other options and consider the cost. The more you pay, the worse your investments will perform.
All too often, investors get trapped by their brokers, emotionally. Because you've trusted and admired them, because you're friends, you're reluctant to think that something might be wrong. You don't want to hurt their feelings by challenging their performance or making complaints. It becomes hard to move your account, especially if you'll still see the broker in your social group."
Read Full article: http://www.cbsnews.com/news/should-you-trust-your-broker-no-and-heres-why/
"The broker is not your friend" - Warren Buffett
"You and your broker (or financial consultant or insurance agent) - or STOCKBROKER have different interests. They have to sell things to make a living. The more they sell, and the more expensive the products, the better off they'll be. Like any other salesperson - for shoes, cameras, advertising or high-tech medical devices - moving products is their job. Your job, as a customer, is to look skeptically at those products, ask yourself if you need them, compare them with other options and consider the cost. The more you pay, the worse your investments will perform.
All too often, investors get trapped by their brokers, emotionally. Because you've trusted and admired them, because you're friends, you're reluctant to think that something might be wrong. You don't want to hurt their feelings by challenging their performance or making complaints. It becomes hard to move your account, especially if you'll still see the broker in your social group."
Read Full article: http://www.cbsnews.com/news/should-you-trust-your-broker-no-and-heres-why/
"The broker is not your friend" - Warren Buffett