🎃 Are your profits being eaten by fees?💰

Seriously, fees can have a significant impact on an investor's returns over time.  For example, an investor who pays a 1% annual fee versus one paying 0.25% a year would have roughly $30,000 more after two decades. Moreover, other fees are often hidden or difficult to understand, making it difficult for you to know how much you are actually paying. Below we delve deeper into some myths and types of fees you are likely to come across:

🌀 Common Myths About Fees 🌀

🚫 You don’t need to worry about fees

🚫 Low fees are always better

🚫 Investing always has high fees

🚫 Incentive fees are always better than fixed fees

🚫 In the long-run, fees have a low impact on your total returns

🌱 How Much Fees Actually Cost You 🌱

💰Advisory management fees: These are charged by investment advisers to manage an investor's portfolio. Note, fees can vary by country. In Switzerland, fees can often range from 0 to 1.5% of your managed assets (Source: Moneyland)

💰Brokerage fees: These are charged by brokers when buying or selling stocks or other investments. These fees can vary widely depending on the broker and the type of investment, but typically range from .2% to 2% (Source: Moneyland).

💰Expense ratios: Expense ratios are charged by mutual funds, index funds, and ETFs. They are shown as a percentage of the investment and charged as an annual fee. A fund that has an expense ratio of 0.10%, for example, means that the investor pays $1 per year for every $1,000 invested (Source: Nerdwallet)

💰Foreign transaction fees: In the EU you may be charged approximately 1-3%, or potentially more, for transactions that take place with a foreign merchant (Source: N26)

💰Lost returns: Fees add up, so much so that they can create a compounding effect on returns over time. As a result, because your investment balance is now lower than it would be without fees, you reduce the amount of money you could potentially earn.

Ultimately, it’s vital to read the fine print. For new and seasoned investors alike, understanding all the different investment fees is a cumbersome, but necessary, process if you seek to maximize your profits. Tools such as comparison calculators can add clarity to making sound investment decisions.

🪄Looking for a magic fee calculator? We’ll send you ours, completely free, if you like or share this newsletter!

🎉 Upcoming Event Alert! 🎉

Want to be financially fit and learn how to reduce those scary fees? 🎃 Financial expert Olga Miler will be conducting a comprehensive 2-hour live webinar on October 31st, 2023, 19:00-21:00 CET (German-language). Register here.

Closing Thought 🌌

What do ghosts invest in?

👻  Crypt-BOO-currencies (with hopefully very low fees!)

As always, staying updated with industry trends and seeking expert opinions when making strategic decisions is essential. Your financial journey is unique, and personalized advice can make it smoother and more rewarding.

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