Aug 082016
 

Use this calculator to see how much your management fees are really costing you. What’s MER? It’s an acronym for Management Expense Ratio; it’s basically the total fees (as a percentage) that a mutual fund charges. More information on MER here: http://profitmoose.com/beginners/how-to-judge-etfs-and-why-i-paid-900-to-ditch-mutual-funds/

ALTERNATIVE OPENING: How much money can you make off your clients?


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%

Something went wrong, check your inputs and try again.

Note: Term has been rounded to

You invested over with a MER of

Your Final Nest Egg (with a 7% annual return):

Nest Egg

Fees Paid:

Nest Egg

If you had used an index fund with a 0.05% MER you would have:

Nest Egg

And you would have paid in total fees.


Try the calculator with a few scenarios and you’ll see what a 3% MER really costs.

“But I get investment advice from my mutual fund advisor. That’s what the fees are for”
-naysayers

How often do you really speak with your advisor? Once or twice a year? Is it worth $1500 per meeting? Books, podcasts, financial blogs, wealthy friends, and/or fee-only advisors can be your teachers.

Sell your mutual funds, seriously

Mutual fund companies are motivated by profit, and they increase their profits by getting clients. They get clients by being attractive and masking their true fees. 3% doesn’t sound like much, but imagine if they advertised fees of $3000/year, or $150,000 from your total retirement fund.

“Give us your money, for only 40% of your retirement fund we’ll invest it for you. Don’t worry that’s only a few hundred thousand dollars.”
-Your old advisor

Sell your mutual funds and buy their index fund or ETF counterparts. If you really need a financial advisor get one that charges a flat fee instead of the profit-motivated mutual fund salesperson.

Note: The calculator doesn’t consideration taxes, inflation, stock market crashes, dollar cost averaging, brokerage fees, etc. (most of the big bank calculators don’t either though)

Spam your friends:

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