Do you know how much you pay in fees for the handling and management of your investments? If not, how do you know you are getting the best value for your money?
Fees cut into retirement savings more than most people realize, because they are essentially compounded along with your earnings. The Securities and Exchange Commission (SEC) calculates that 1% annual fees for a $100,000 starting portfolio will cost you $28,000 over twenty years of investing. You could have used that $28,000 to gain another $12,000 had it been reinvested.
Keep the following tips in mind as you review your investments, and see how you can maximize your fund balances.
There is nothing inherently wrong with paying fees for your investment management, as long as you are receiving relative value for your money. Look over your portfolio and compare it with similar funds at similar levels of risk. If you find your investments to be lacking, you may not want to switch straightaway, but at the very least, your investment group has some explaining to do. Make them earn their fees, or find a better option.
Let the free MoneyTips Retirement Planner help you calculate when you can retire without jeopardizing your lifestyle.
This article was provided by our partners at moneytips.com.