How to Redeem Mutual Funds

Mutual funds can be a powerful investment tool, allowing you to buy in to the funds without the need for extensive stock research. When the mutual fund matures or you decide that you want to sell your shares, though, you may find yourself wondering exactly how to redeem your mutual fund investment. Mutual funds are actually quite easy to redeem, so you should have no trouble redeeming your investment whenever you are ready to do so. Read on to learn how to redeem mutual funds.

Difficulty: Easy

Instructions

1. Consult your mutual fund investment statement, which should have a transaction slip at the bottom of the page. Instructions for filling out the transaction slip and a mailing address for the mutual fund company should be featured on the back of the statement so that you can mail it in and redeem your mutual fund shares.

2. If you don't wish to redeem your mutual fund shares by mail or have misplaced your investment statement, visit the broker that you originally purchased the mutual fund shares through. Whether it is a physical broker or an online brokerage, you should be able to redeem your shares with very little difficulty. If you have a money market account set up through your broker, the funds from your redeemed mutual funds will likely be deposited directly into that account for you to withdraw or reinvest.

3. Another alternative for redeeming your mutual fund shares is to wait for the mutual fund to reach its maturity date. Most brokers will have an option to let you automatically redeem a mutual fund that has reached its date of maturity, again depositing the money from the mutual fund directly into your money market account. Depending on the brokerage that you use, you may also have the option to use this money to invest in other mutual funds or stocks automatically from your money market.

Tips & Warnings

• Some mutual funds may have penalties which will be applied for redeeming them before their maturity date. Make sure that you check to see whether these penalties will apply (or if there is a grace period that you can redeem your shares during in order to avoid them) before redemption to avoid having to pay more just to get your invested money.