Do you know how much your mutual funds, index funds and ETFs are costing you?
Do you know how much your mutual funds, index funds and ETFs (Exchange Traded Funds) are costing you? Over your lifetime you may unknowingly end up paying $96,000 to $3M in fees. Let me show you how to avoid paying those fees.
All funds carry a fee, it's know as an MER (Management Expense Ratio). The MER includes the management fee plus the fund's day-to-day operating expenses, employee salaries, office space, office equipment, record keeping, fund valuation costs, audit a…
Is it better for you to buy Index Funds (or ETFs), instead of investing on your own?
Is it better to just buy Index Funds (or ETFs), instead of investing on your own (in individual stocks)? This is a question that I hear frequently. I'll answer this important question right now, let's get started...
Trillions have gone into index funds
According to Morningstar during the past 10 years, investors have pulled about $1.4 trillion from active U.S. stock funds, with most of the money — $1.3 trillion – going to passive funds (Index and ETFs).
What is an Index Fund?
An index fund buy…
How Much Are Your Investments Costing You?
Do you own any Mutual Funds, ETFs, or Index Funds? If so, do you know how much you pay in fees each year?
What is the fee?
Each of the investment products I listed above have fees. The fund company has to employ fund managers and staff, has to pay for office space, marketing, and advertising. As a fund investor you have to pay for the cost of running the fund. This fee is called the Management Expense Ratio (MER), and is easy to find out how much you are paying.
Mutual Fund Fee Calculator
Should you buy Index funds, ETFs, or individual stocks?
Should you buy index funds or ETFs? Is it better than dividend investing?
Here’s my take on it….
I bought my first mutual fund 31 years ago, then moved to index funds, then ETFs. I’m now 100% in dividend paying stocks and have been for the last 20 years. The return on my dividend stocks has far outpaced my first 10 years as a mutual fund investor. I don’t consider myself an active investor; I’ve owned most of my stocks for more than a decade. Last year I executed just one trade.
I'm not tryin…
What’s Wrong with Index Funds?
There are three issues that I have with index funds, and that’s why I don’t invest in them.
But first let’s make sure you know what an index fund is.
What is an index fund?
An index fund is a mutual fund that pools money from lots of investors like yourself, and then invests that money on your behalf into stocks. A typical mutual fund has a fund manager who decides which stocks to buy and sell. However an index fund has no live fund manager, the fund manager is a computer that buys stocks fro…
Can Your Own Mutual Fund Do Better?
In the long run is it better to create your own income mutual fund, or just buy the most popular ones being sold by the banks and mutual fund companies?
To answer this question, I refer to Tom Connolly from DividendGrowth.ca.
Tom Connolly recently wrote a post about building your own portfolio versus buying an income fund.
One reason Tom Connolly, myself and others run our own portfolios is because we can perform much better versus the "store-bought" funds:
1. We can invest in specific super…
What's the Worst Mutual Fund in the World? Hint: its an index fund
Micheal Johnston from Fund Reference believes he has found the worst mutual fund in the world. Over your lifetime this mutual fund will cost you $114,000 extra in fees!
"...the Worst Mutual Fund in the World is not an absurdly expensive fund run by a manager pursuing some exotic strategy. It’s actually an index fund that seeks to replicate one of the most widely-followed benchmarks in the world. Wondering how such a product could be the target of such scorn from a fan of indexi…
Worried About Not Having Enough Money?
Are you concerned about not having enough money for your kids, for yourself, for your retirement? The key is to make the right financial decisions today so that your future self will be taken care of.
The right financial decisions are:
- Spend less than you earn, and invest the difference
- Pay off your debts quickly
- Eliminate or reduce the hidden fees you pay in mutual funds
All mutual funds carry fees, these fees are called the Management Expense Ratio (MER). The MER is there to pay the m…
How I saved 4672% in Fees, and Continue to Make Over 14% Each Year on a Single Stock
Update [July 2021]: The TRP dividend today is $2.81,and my dividend yield based on the purchase price is now 21%.
Today I’m going to share with you one of my success stories. The purpose of my story is to show you that great returns are possible without resorting to expensive mutual funds.
My story begins in 2000 when I decided to buy 185 shares in a company called TransCanada (TRP). After applying the 12 Rules of Simply Investing I decided that TRP would be a great investment. TRP had:
- A str…
Still Hanging on to Your Mutual Funds?
Over your lifetime you may lose 80% of your returns to mutual fund fees. A while back John Bogle founder of the Vanguard Group, was interview by the TV program Frontline.
Mr. Bogle was asked: "What percentage of my net growth is going to fees in a 401(k) plan?"
Bogle replied, "Well it's awesome. Let me give you a little longer-term example. An individual who's 20-years old today [is] starting to accumulate for retirement.... That person has about 45 years to go before retirement -- 20 to 65 --…