WHY SHOULD I PAY ATTENTION
TO MY INVESTMENT FEES?
Investment fees reduce your profits or increase your losses from investing.
When you understand your fees, you can evaluate the true cost of the investments in your portfolio and the services you receive from your investment advisor.
Knowing what you paid to buy, sell, or hold an investment in a given year can help you make better investment decisions.
COMMON MYTHSABOUT INVESTMENT FEES
Not so. Paying a 2.5% fee rather than a 1.5% fee on your $50,000 investment could reduce total returns by more than $17,500 over 20 years, assuming a 5% annual return.
Actually, investment advisors are paid by their clients directly, by the firms they work for, or by the institutions whose investment products they sell. You can find out exactly what you paid your advisor’s firm last year—and what the firm received from others—from your annual investment fee report, also known as the Annual Charges and Compensation Report.
Lower fee options often exist, even among very similar products. Some fees may be negotiable. Make a habit of asking your registered investment advisor about the fees you will pay for the products you buy and the services you receive. Always ask your investment advisor if there’s a lower fee option that’s right for you.
When it comes to investing, knowledge is power. Use the calculators and other resources below to learn more about how your investments work, and how different factors can affect your returns.
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