Many mutual funds can meet the particular
style and Asset Allocation you desire. Some may have load fees (sales charges) where only
95% to 99% of your money is invested on your behalf (the rest goes to
the salesman). Others may have annual 12(b)(1) fees for marketing. All
have annual management fees and expenses which may be high or low.
All fees are
disclosed in the fund's prospectus. Active Management Funds generally
have higher fees and costs than passive Index Funds. To offset these
higher expenses, the active managers must earn "excess"
returns over an index just to break even. We plan on adding one of the
many Internet databases available that show the costs and fees.
The fund's prospectus will break down your
annual costs into Management Fees, Distribution and
Service 12b-1 fees (essentially a marketing
fee charged each year), and Other Expenses (the costs of trading and
bookkeeping). These add up to the total annual fund
operating expenses paid by you.
If you only have a single number for
annual costs, enter that for the Management Fee and enter zeroes for
Distribution Fees and Other Expenses.
Enter
your Investment Horizon, annual Expected Return, Current Holdings, and
then the costs for two funds below. Clicking any other box triggers the
calculation.
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