Your broker is where your savings live for decades. A slick app is nice; these seven checks are what actually matter.
1. Who regulates it — and can it serve you?
Look for a licence from a recognised authority, and confirm it covers residents of your country. Search the broker’s name in your national regulator’s register (your country page names the regulator). Offshore licences from small jurisdictions offer far less protection.
2. What happens if the broker fails?
Most developed markets run an investor compensation scheme. In the EU the minimum is €20,000 per investor; some countries and schemes cover much more. Equally important: client assets should be segregated from the broker’s own money, so they can be returned even if the firm goes under.
3. Total cost — not just “zero commission”
Add up everything you’ll pay in a typical year:
- commissions per trade,
- currency conversion fees,
- custody, account or inactivity fees,
- withdrawal fees.
“Commission-free” brokers often earn through wider FX spreads. If you invest in another currency every month, that line can dominate your costs.
4. Can you buy what you actually want?
Check the exchanges and products available: your local market, US and European stocks, and the specific ETFs you plan to hold. Investors in the EU/EEA should confirm the broker offers the UCITS ETFs they want.
5. Do you own the real shares?
Some apps sell CFDs or “derivative” exposure rather than actual shares. CFDs are leveraged products where most retail accounts lose money. For long-term investing, make sure you’re buying the underlying shares or ETF units.
6. Tax reporting
Some local brokers withhold and report tax for you; most international brokers don’t. If you’ll have to file yourself, check that the broker provides clear annual statements — it saves real time and accountant fees.
7. Deposits, withdrawals and support
Test the boring parts: how long withdrawals take, which currencies you can hold, whether support answers in a language you’re comfortable with, and how easy it is to transfer your portfolio out later.
A simple scoring method
Give each check a score from 0 to 2. Anything scoring 0 on checks 1, 2 or 5 is a no, regardless of the rest. Among the brokers left, pick the lowest total cost for the way you invest — monthly small purchases, or occasional larger ones.
This guide is general education, not personal financial advice. Your situation, country and tax rules matter. Disclaimer.