Table of Contents
High fees are the silent killer of retirement wealth. A 1% difference in fees can cost you over $150,000 over a lifetime of investing.
Key Takeaways
High fees can eat your retirement. Learn how to spot them and lower them.
- Types of Fees
- How to Check
- Frequently Asked Questions
- Conclusion
- Related Calculators
Types of Fees
- Expense Ratios: The cost to own a mutual fund or ETF. Look for index funds under 0.10%.
- Admin Fees: Costs charged by the 401(k) provider to run the plan.
- Advisory Fees: Charges for managed accounts or advice (often 0.50% or more).
How to Check
Read your annual fee disclosure required by the Department of Labor. If your plan offers only high-cost funds, campaign for better options or contribute just enough for the match and invest the rest in an IRA.
Frequently Asked Questions
How much should I save for retirement?
Aim to save at least 15% of your income annually.
What is the difference between a 401(k) and an IRA?
A 401(k) is employer-sponsored, while an IRA is an individual account you open yourself.
When can I retire?
It depends on your savings and lifestyle, but typically between ages 60 and 67.
Conclusion
You can't control the market, but you can control your costs. Keeping fees low is the only guaranteed way to improve your investment returns.