Total Fees – You Are Probably Paying Lot More Than 1% Per Year
Do you really know the total fees you’re paying to have your assets managed? 1 percent is the typical advisor fee. An additional 1 percent is the typical money manager fee to manage your assets.
According to the New York Times, 1.23 percent is an average mutual fund expense…. you can find it listed in your prospectus. Add to this a 1.44 percent average mutual fund trading cost, which is, according to Forbes, a hidden cost at the mutual fund level, incurred when each mutual fund manager buys and sells stocks and/or bonds in the portfolio.
.83 [pronounced “point 83″] percent is the average cash drag, an opportunity cost Forbes points out, based on how much return you lose when your mutual fund manager keeps funds in cash at low returns. That’s 5.5 percent of total potential fees for asset management.
Your actual fees could be higher or lower.
You may also be interested in this recent video from our Whiteboard Series.
If you want to find out exactly how much you are paying in fees and learn ways to reduce them, call us today.
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