Keeping Costs Low

It's easy to think of investment costs as a few pennies here and there that don't add up to much. But over the long term, keeping costs low may enhance your retirement nest egg because more of what you earn will go to work for you.

Focus on fees

You expect to pay for the services you receive from a financial company, but high fees can really add up over time.

Look for accounts with low fees — and avoid unnecessary fees on low balance accounts by consolidating assets to help meet minimum requirements.

Find out how much you're paying in fees on your current accounts — and look for lower cost options.

Mutual fund sales charges

Some mutual funds charge sales loads to purchase shares. Some funds charge a redemption fee when shares are redeemed. In fact some funds charge fees and sales loads when you buy and when you redeem.

Do you get better management for your money if you pay a sales charge?
Not necessarily.

When it comes to fees, many investors overlook the fine print. But even a small difference in fees may make a big difference in your potential returns. That's why, at AARP Financial, we're determined to keep fees low.

Operating expenses

Every mutual fund incurs expenses — to compensate portfolio managers and cover operating expenses. However, the fees that funds charge to cover these expenses vary widely.

There's no guarantee that a low cost fund will do better than one with higher fees. However, there's no evidence that higher cost funds do better either. But one thing's for sure — when fees are lower, you start out ahead.

Learn more about fees and expenses

AARP Financial Inc. does not provide tax advice. Please consult a tax advisor for information pertaining to your particular situation.

The information and content provided herein is general in nature and is for informational purposes only. It is not intended, and should not be construed, as a specific recommendation, or legal, tax or investment advice, or a legal opinion. Individuals should contact their own professional tax or investment advisors or other professionals to help answer questions about specific situations or needs prior to taking any action plan based on this information.

The Financial Advisors are investment adviser representatives of AARP Financial Inc., an investment adviser.

AARP Financial is a collection of insurance and financial products, services and programs made available by AARP. Neither AARP nor its affiliate is the provider. AARP contracts with providers to make coverage available to AARP members.

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