What Expenses Are There for Mutual Funds?

Series Summary

Personal finance is the application of financial principles to the monetary decisions of an individual or family unit. It addresses the ways in which individuals or families obtain, budget, save and spend monetary resources over time, while taking various financial risks and future life events into account. Components of personal finance might include checking and savings accounts, credit cards and consumer loans, investments in the stock market, retirement plans, social security benefits, insurance policies and income tax management. In this free video series, a registered financial consultant provides advice for people interested in learning more about making investments. Find out about the best place to invest new money, the rate of return for mutual funds and how investing works. Learn how to do fixed income investing, how to understand municipal bonds and how to set up an investment savings account. Gain a better understanding of the investment world with information in these free videos.

Video Transcript

"This is financial adviser Patrick Munro talking about, what expenses are there for mutual funds. There are many mutual funds available, in fact there's over 11 thousand available out there in the market place today. But mutual fund managers don't work for free. There are expense ratio's to consider, and you have to be aware of what these expense ratio's are all about. When you look at a mutual fund you have to look at their overall load, and the load is the fee that the manager charges to actually take the money into the mutual fund and manage it for the client. These charges and expenses can range as high as 3 percent. So if you made 4 percent in that particular mutual fund, but had to pay a 3 percent load, you only made 1 percent, and you could have done better at the bank. So it's important if you're a mutual fund investor to be aware of the expense ratio in all mutual funds and how they affect your rate of return. This is Patrick Munro financial adviser, talking about, what expenses are involved in mutual funds."