Blog

Category: Costs

The Hidden Costs of Mutual Funds

The Hidden Costs of Mutual Funds

Posted By Lineweaver Financial Group
September 08, 2017 Category: Mutual Funds, Expense, Costs

With the push to increase the transparency with what investors pay for advice, one area that is not truly transparent are the costs associated with mutual funds. While mutual funds do disclose their expense ratios, many costs are not published, and can erode your real returns. Here are a couple of examples of these costs, and what you can look out for. Disclosed Costs: The disclosed costs of mutual funds are supposed to be revealed to you. But there are many of these costs. For example, there can be shareholder fees, which can consist of front-end loads, back-end loads, purchase fees, redemption fees, exchange fees, and account fees. There is also the expense ratio, which includes operating costs, management fees, 12b-1 distribution fees, and administrative costs. How much do they cost? According to a study published in the Financial Analyst Journal that was authored by finance professors at the University of California Davis, University of Virginia, and Virginia Tech, the average expense ratio is 1.19%. Hidden Costs: Mutual funds conduct trades, many on behalf of other investors. For example, after you buy a mutual fund, the mutual fund will continue to accommodate other investors as they invest into and divest out of the mutual fund. Their trading on behalf of other investors imposes a cost onto you. There are three sources of these costs. First, mutual funds must pay brokerage commissions when they trade. This cost is shared by all mutual fund investors. Second, mutu

Categories
General (40)
Newsletter (37)
Finance (19)
Economic Commentary (18)
Commentary (17)
Retirement (15)
Retirement Planning (14)
Letter From The President (14)
Economy (13)
Educational (12)
Portfolio (11)
Tax (11)
Financial Planning (11)
Healthwatch (10)
Lineweaver (10)
Market Commentary (8)
Taxes (8)
Blog (7)
Q3 (7)
Tax Planning (7)
Market (6)
Education Programs (6)
Health (4)
Bonds (4)
LFG (4)
IRA (4)
Estate Planning (4)
Social Security (4)
(3)
Tax Law (3)
Insurance (3)
2017 (3)
Diversification (3)
Interest Rates (3)
Market Review (3)
Trump (3)
Annuities (2)
Tax Scams (2)
Rising Interest Rates (2)
Annuity (2)
Investing (2)
HealthWatch (2)
Volatile Market (2)
Stocks (2)
Strategies (2)
Tax Cuts And Jobs Act (2)
Coordination (2)
Financial (2)
Real Estate (2)
Charity (2)
Economic Outlook (2)
Fraud (2)
Brexit Update (2)
Financial Strategies (2)
Investments (2)
2016 (2)
Election (2)
Social Security Benefits (2)
2019 (2)
High Income (2)
Q2 Newsletter (2)
Market Update (2)
Client Spotlight (2)
2018 (1)
Sell In May And Go Away (1)
Roth Conversion (1)
Quarterly Newsletter (1)
Screens (1)
Traditional Ira (1)
Congress (1)
Dementia (1)
Eye Strain (1)
Stock (1)
Financial Quarterback (1)
Sell (1)
Roth Ira (1)
Buy (1)
Cooking (1)
Q2 2019 (1)
James Lineweaver (1)
Market Outlook (1)
Tips (1)
Q1 (1)
New Years Resolutions (1)
Pro Football Hall Of Fame (1)
Financial Goals (1)
Anne Graffice (1)
Vacation Home (1)
Chad Roope (1)
David Baker (1)
Sring Cleaning Your Finances (1)
Exercising (1)
Keeping Your Mind Sharp (1)
Healthy (1)
Legal (1)
Wills (1)
Jim Lineweaver (1)
Statements (1)
Review (1)
2021 Outlook (1)
2020Q3 (1)
Medicare (1)
Medicare Supplements (1)
Your Retirement Playbook (1)
2020Q4 (1)
Markets Don\'t Pick Sides (1)
Sleep (1)
Healthy Living (1)
Eductional (1)
Probiotics (1)
News (1)
Awards (1)
Crain\'s (1)
Investment. Advisers (1)
Dividends (1)
Technology (1)
Education (1)
Planning (1)
College (1)
2020 (1)
Steps (1)
Credit Unions (1)
POA (1)
Pse (1)
Big Banks (1)
Savings (1)
Checking (1)
Banking (1)
Longterm Care (1)
Healthcare (1)
Elder Law (1)
Power Of Attorney (1)
Nutrition (1)
Charitable (1)
Donations (1)
End Of Year Taxes (1)
Tax Strategies (1)
Black Swan (1)
CARES (1)
CARES Act (1)
Marital Trust (1)
Stimulus (1)
Vacation From Investments (1)
Distribution (1)
Bloodline Trust (1)
Roth (1)
Retiring (1)
Self Employed (1)
Business Owners (1)
Annuity Alternatives (1)
Life Insurance (1)
Dividend (1)
Bonds Ladder (1)
Policy (1)
Donor Advised Fund (1)
Retire Early (1)
Private Foundation Charitable Lead Trust (1)
Charitable Remainder Trust (1)
Growing Your Wealth (1)
REITs (1)
Risk Management (1)
Protection (1)
North Korea (1)
Conflict (1)
Lineweaver Wealth Advisors (1)
Legacy (1)
Retire (1)
Expense (1)
Gifting (1)
Retirement Tips (1)
Financial Advice (1)
Financial Advisor (1)
Social Security Planning (1)
Charitable Contributions (1)
Women And Money (1)
Service Day (1)
Harvest For Hunger (1)
Candidates (1)
Q1 2017 Newsletter (1)
Politics (1)
Fall 2016 (1)
Financial Health (1)
Holiday Planning (1)
Stockpile (1)
Holiday Gifts (1)
1st Quarter (1)
2016 Market (1)
Winter 2017 (1)
Mutual Funds (1)
Costs (1)
Trusts (1)
Markets (1)
New Tax Law (1)
529 Plans (1)
Charitable Giving (1)
Q2 (1)
New Website (1)
Bruce Motko (1)
Travel Tips (1)
Travel (1)
Drink Water (1)
NAFTA (1)
Market Volatility (1)
Cryptocurrency (1)
Investment (1)
Bitcoin (1)
Advice (1)
Summer (1)
Q3 Newsletter (1)
In Laws (1)
Inheritance (1)
Trading (1)
Tariffs (1)
401(k) (1)
Tax Cuts (1)
Equifax (1)
Mark Sipos (1)
2017 Q4 (1)
Identity Theft (1)
Third Quarter (1)
Tax Cuts And Job Act (1)
Introducing (1)
Kids (1)
Grand Kids (1)
Jobs (1)
RMD (1)
Lose Weight (1)
Eat More (1)
Market Review 2017 (1)
Letter From The President New Years Resolutions (1)
Transfer Real Estate (1)
Defer Tax (1)
Top Financial Strategies Of The Wealthy (1)
Market Pullback (1)
Reallocation (1)
Pros And Cons (1)
+ Show More

Terms and Conditions | Privacy Policy | Disclosures

Lineweaver Financial Group ©
Powered by Virteom Logo Virteom