Fund Fees Fall To Earth

It has never been cheaper to own shares in a mutual fund or ETF, reports Morningstar in its annual fund fee study.

Fund management fees fell 8% from 2016 to 2017, the biggest year-over-year decline ever recorded, representing $4 billion in savings for investors, according to Morningstar.

Lower fees are due in part to the increasing popularity of unmanaged “index” type funds, which are cheaper to run than actively managed offerings.

Many investment companies also implemented across the board fee cuts for their actively managed funds, thanks to economies of scale resulting from asset growth.

Companies like Fidelity, BlackRock (iShares) and Schwab have aggressively cut fees on their core index funds as each firm vies to become the lowest cost provider in a fiercely competitive investment market.

About Mari Adam

Mari Adam, Certified Financial Planner™ has been helping individuals and families chart their financial futures for over twenty-five years. Have a question about your financial situation? Ask Mari!


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