Comparison shopping urged when buying financial products

Windsor Genova – Fourth Estate Cooperative Contributor

Washington, DC, United States (4E) – Investors planning to buy securities should perform comparison shopping that ordinary consumers do in choosing products to buy, according to the Financial Industry Regulatory Authority Investor Education Foundation (FINRA Foundation).

The FINRA Foundation made the recommendation after learning in a study that many investors conduct only limited research based on best prices or terms of stocks, trust funds or bonds. Its National Financial Capability Study released in March found that almost two-thirds of all credit card holders did not compare offers for best rates or conditions in choosing their card provider.

The Foundation shared several tips on comparison shopping for financial products. On top of their list is reviewing sources of information that enable the investor to go beyond the claims in advertisements and other promotional materials that a product is better than others.

Daily Finance listed at least five good sources of additional information. First are the unbiased online sites, such as Bankrate.com, which compares yields and fees for savings accounts and certificates of deposits and terms and costs of insurance policies. The site likewise has interest rates and conditions for credit cards, car loans, personal loans and mortgages.

Another good site is InvestView, Inc. (OTC: INVU), a New Jersey-based investor technology and education company that makes available products that permit the individual investor to find, analyze, track and manage their portfolio. The company also offers online education, analysis and application platforms to customers on a subscription basis delivered online through its web site, trading tools with actionable trading indicators, blogs, newsletters and other reference materials.

“Whether you are a long term investor who needs assistance and mentoring managing your portfolio utilizing our educational platform with tools, analytics, and video tutorials, or you don’t have a great deal of time and just require actionable trading ideas from our 7Minute products, InvestView will empower you with all your education needs to become a successful investor,” said Dr. Joseph Louro, Chief Executive Officer of InvestView.

InvestView offers the 7 Minute Investor, a service launched in December 2013. It is a subscription-based newsletter that offers access to three different stock portfolios with focus on large-, mid- or small-cap companies. Other InvestView offerings for the busy investor are the 7 Minute Trader and the 7 Minute Options. More information about InvestView can be found in www.investview.com.

Daily Finance also suggested reading consumer and money publications such as Consumer Reports, Better Business Bureau and finance magazines and web sites that publish comparison and ratings for various financial products.

The third suggested sources are newspapers and news sites, particularly the business and personal section of local, national and financial publications. Fourth are other products providers that can give fee tables or terms and conditions of financial products. Fifth are offering materials, which usually include term sheets for mortgages and other loans and terms and conditions circular for credit cards. A look into disclosure documents for investments such as mutual fund’s prospectus is also recommended.

After getting hold of relevant materials, the next step is to know what to look for in those materials, the foundation said. Among the key points to search for are the administrative costs and fees, the conditions such as the length of the period during which money will be tied up in savings or investment products, early withdrawal and cancellation fees, and penalties for paying off early loans or mortgages.

Further key points are the kind of returns the investment would yield by finding out how the return is computed and the benchmark if the product is based on market performance. Know any caps or limits on return. Also check if the product has a free-look or cooling-off period, which would allow the investor to cancel a contract without a penalty, the risks involved in a particular products and the tax consequences.

Read the fine print and look out for comments and ratings of previous owners or users. Always be on the lookout for investor education workshops such as the one organized by BetterTrades on June 24-26 in Chicago, Illinois.

“The stock market can be a very confusing place, especially for a newcomer ,” Bill Corcoran, CEO of BetterTrades, said. “We’ve shown thousands of beginners, many of them complete novices, how to get started the right way in the stock market.”

Corcoran added, “It is our mission to educate, train, and instruct investors so they can make their own stock market decisions. Our education is all about empowering the individual to take control of their financial future.”

Comparison shopping for financial products makes good sense — and can save you money — whether you’re looking to save and invest or to tap a new line of credit with a credit card or loan, Daily Finance said.

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