What is an acceptable management fee for a mutual fund? (2024)

What is an acceptable management fee for a mutual fund?

Management fees, whether paid as a mutual fund expense ratio or a fee paid to a financial advisor, typically range from 0.01% to over 2%. Generally, the range in fee amount is due to management strategy.

What is a reasonable management fee for mutual funds?

Mutual fund expense ratios are typically between 0.25% and 1% of your investment in the fund per year. Actively managed funds are usually more expensive than passively managed funds. Index funds and exchange-traded funds are typically the cheapest funds.

What is the average fee for a managed fund?

Is a 1% management fee high?

Many financial advisers charge based on how much money they manage on your behalf, and 1% of your total assets under management is a pretty standard fee.

Do you have to pay management fees for mutual funds?

Each mutual fund and ETF pays its own operating expenses, including legal, accounting, and management expenses.

What does Fidelity charge to manage a portfolio?

Portfolio Advisory Services – This wealth management account requires a $50,000 minimum, and the fee is 1.1% per year. Investments of $500,000 or more range from advisory fees of 0.5% to 1.5% per year.

How much does Morgan Stanley charge for mutual funds?

Morgan Stanley charges each fund fam- ily we offer a mutual fund support fee, also called revenue-sharing, up to a maximum per fund family of 0.16% per year ($16 per $10,000 of assets) on the mutual fund holdings of our brokerage account clients. The minimum charge is $250,000 per year per fund family.

Is 2% fee high for a financial advisor?

Most of my research has shown people saying about 1% is normal. Answer: From a regulatory perspective, it's usually prohibited to ever charge more than 2%, so it's common to see fees range from as low as 0.25% all the way up to 2%, says certified financial planner Taylor Jessee at Impact Financial.

Is a 1.5 fee high for a financial advisor?

While 1.5% is on the higher end for financial advisor services, if that's what it takes to get the returns you want then it's not overpaying, so to speak. Staying around 1% for your fee may be standard but it certainly isn't the high end. You need to decide what you're willing to pay for what you're receiving.

Are Morgan Stanley fees too high?

At Morgan Stanley, or any big firm, 1% is a fairly common fee---and a fair one, in many cases--provided it covers all transaction costs and is the Advisors' sole compensation on the account [meaning that the client's interest should be the Advisor's only interest.]

Can I negotiate management fees?

How negotiable are management fees? In the pre-investment due diligence phase, management fees represent the largest estimable cost. [1] Therefore, they are an excellent candidate for negotiation.

Is 0.5 management fee high?

0.5% is a pretty low fee. You must have substantial assets or they're burying other fees. 0.5% of assets sounds small but is about 6% of your profits if you earn 8%. That means for every 12 months you retire, they retire a month.

How do financial advisors get paid on mutual funds?

Mutual funds charge their investors front-load fees when they buy into the fund and back-load fees when they leave it. Every time an investor buys or sells shares of the fund, they are charged one of these fees. A financial advisor receives a small share of both of these fees.

Which funds have lowest management fees?

Is there a penalty for closing a mutual fund?

You can generally withdraw money from a mutual fund at any time without penalty. However, if the mutual fund is held in a tax-advantaged account like an IRA, you may face early withdrawal penalties, depending on the type of account and your age at the time.

How to negotiate financial advisor fees?

What is the downside to Fidelity?

In most situations, you will find what you need at Fidelity. There are a few downsides. Fidelity does not offer cryptocurrency investing. The company is also missing some features found on other investment platforms, like futures trading and paper trading, where you can practice trading.

Who is better Fidelity or Vanguard?

While Fidelity wins out overall, Vanguard is the best option for retirement savers. Its platform offers tools and education focused specifically on retirement planning.

Should I use Fidelity or Charles Schwab?

Overall Appeal. Fidelity and Schwab are both excellent choices. These investment firms offer thousands of funds. There are some nuances, such as Fidelity being better for crypto traders and Schwab being more optimal for futures traders.

Is Morgan Stanley or Fidelity better?

Both companies are highly regarded. Fidelity is consistently rated among the top online brokers; it often occupies the top spot. In 2023, 35 of the financial advisors on the Barron's Top 100 list came from Morgan Stanley.

What is the most common mutual fund sales charge?

By regulation, the maximum permitted sales charge is 8.5%, but most loads fall within a 3% to 6% range. The level of sales charge an investor incurs often depends on the specific share classes of a fund.

At what net worth should I get a financial advisor?

Generally, having between $50,000 and $500,000 of liquid assets to invest can be a good point to start looking at hiring a financial advisor. Some advisors have minimum asset thresholds. This could be a relatively low figure, like $25,000, but it could $500,000, $1 million or even more.

What does Charles Schwab charge for a financial advisor?

Are Merrill Lynch fees high?

The range of the markup that Merrill charges is between 0.50% – 2.00%, depending on the maturity of the MLI. A portion of the Merrill markup, which may be discounted by your Advisor, is paid to your Advisor as compensation.

What is a reasonable investment advisory fee?

The average fee for a financial advisor generally comes in at about 1% of the assets they are managing.