2. Loads

There are several types of mutual funds available in the market. Depending on the type of fund, loads on mutual funds vary widely. Few kinds of mutual fund charges like front-end fees which you pay at the time of the initial purchase for your investment and back-end load fees while you sell off your investment within a specified number of years, usually 5 to 10 years. Since there are a variety of mutual funds available in the market, it makes no sense to pay higher front-end or back-end load fees on your mutual funds. If possible, you must opt for no-load mutual funds or products outside of the mutual fund family to avoid these fees.

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3. Your Financial Advisor

Usually financial advisors ask for a big sum, but it’s mandatory to pay. Since you cannot avoid the advisors’ fee, you can always try to reduce it. How? As you know there are two ways by which advisors charges you their fees. First is “Fee-only advisors” where you pay the advisor on annually regardless of whether your mutual funds made any gains or not. Second is a commission-based advisor, who charges a commission fee each time he renders you any services. Always look for a fee only advisor that charges less than 1 percent of your total assets or someone who charges by the service instead of an asset based fee.

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