Stockbrokers vary widely in their ability and focus, and may have little or no training in financial planning. This means that there are stockbrokers out there who will be great at helping you plan and save for college, as well as those who have very little experience.
Since the vast majority of stockbrokers work on commission, there is a natural conflict of interest that exists between your needs and their income. Oftentimes, a stockbroker will only make money if you invest with them, which can blind their ability to give impartial advice. Further, many stockbrokers’ investment recommendations are limited by their firms’ relationships with other investment companies.
For example, a large Wall Street firm may only have agreements with a portion of the companies offering Section 529 plans. Thus, a stockbroker’s recommendation may be based more on what they can offer you through their firm than what is best for you.
Generally, the best way to find a stockbroker is by asking other friends or professionals you trust. Once you’ve narrowed it down to a few potential candidates, you can perform an abbreviated background check on the National Association of Securities Dealers website.
