Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
question about fund expenses
Old 01-03-2007, 01:13 PM   #1
Thinks s/he gets paid by the post
simple girl's Avatar
 
Join Date: Sep 2006
Posts: 2,505
question about fund expenses

Hi all,

When evaluating mutual funds, I've always made sure that they are no-load and have low expense ratios. A friend of mine recently asked me about management fees. Basically, a fund in his 401K has an exp ratio of 0.81 and a management fee of 0.61. Is this management fee part of the expense ratio, or should the two be added together to assess the full expenses of the fund? Hope this isn't too basic of a question!

Thanks!
__________________

__________________
simple girl
less stuff, more time

(49, married; DH 53. I am fully retired as of 2015 (well ok, I still work part-time but only because I love the job and have complete freedom to call off if I want to travel with hubby for work), DH hopes to fully retire 2018 when he turns 55 to access 401K penalty-free...although he may decide to do part-time consulting)
simple girl is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Re: question about fund expenses
Old 01-03-2007, 01:21 PM   #2
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Re: question about fund expenses

Management fee is part of the expense ratio. Ideally, the expense ratio should be an all-in figure, inclusive of management fees, commissions, etc. It misses out on some stuff that can be hard to measure (bid-ask spread, etc.), but for index and low turnover funds it is usually pretty close.
__________________

__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Re: question about fund expenses
Old 01-03-2007, 04:38 PM   #3
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
mickeyd's Avatar
 
Join Date: Apr 2004
Location: South Texas~29N/98W
Posts: 5,880
Re: question about fund expenses

Quote:
I've always made sure that they are no-load and have low expense ratios. A friend of mine recently asked me about management fees. Basically, a fund in his 401K has an exp ratio of 0.81 and a management fee of 0.61. Is this management fee part of the expense ratio,
I'm curious about the two parts of the above statement that IU have italicized. How are you so aware of the low expenses if you do not know how they are calculated? Have you read the prospectus that you received? Under the section entitled "Annual Fund Operating Expenses" it should clearly indicate mgt. fees, 12b-1 fees and other expenses and a total of the fund's expenses.
__________________
Part-Owner of Texas

Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx

In dire need of: faster horses, younger woman, older whiskey, more money.
mickeyd is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
401k Question jbs6 Young Dreamers 8 01-07-2007 08:44 PM
Vanguard Fund Actions REWahoo FIRE and Money 1 04-20-2006 03:36 PM
"Strategy fund" expenses - double dipping? Rich_by_the_Bay FIRE and Money 4 03-04-2006 09:34 AM
Question for Vanguard Fund Holders? Momtwo FIRE and Money 4 09-06-2005 02:29 PM
Question about using fund to pay mortgage Tadpole FIRE and Money 4 11-07-2004 06:58 PM

 

 
All times are GMT -6. The time now is 11:15 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.