Understand the Fees of Retirement Planning Asset Strategy

Retirement planning is a crucial process that requires careful consideration of various factors, including investment options, risk tolerance, and fees. Fees are an essential aspect of retirement planning, as they can significantly impact the overall value of retirement savings. Therefore, it is crucial to examine and understand the fees associated with various retirement planning options to make informed decisions and better manage retirement savings.

Address Management Fees

One of the most common fees associated with retirement planning is management fees. These fees are charged by investment advisors and mutual fund companies for managing retirement savings. Management fees can range from 0.5% to 2% of the total retirement savings and can impact the overall value of the retirement portfolio.[1] Therefore, it is essential to examine management fees carefully and compare them among different investment options to find out which options may help you best achieve your retirement goals.

Note Administration Fees

Another fee to look out for is administrative fees, which are charged by retirement plan administrators for managing the retirement plan. These fees can include record-keeping, legal, and other administrative expenses and can range from 0.1% to 1% of the total retirement savings. While administrative fees may seem small, they can add up over time and impact retirement savings. Therefore, it is important to examine administrative fees to see if you’re getting value out of what you’re paying for.[2]

Keep Watch for Sales Charges

Sales charges are another fee to consider when planning for retirement. Sales charges, also known as front-end or back-end loads, are fees charged by mutual fund companies for buying or selling shares of the fund. Front-end loads are charged when purchasing shares, while back-end loads are charged when selling shares. These charges can range from 3% to 5% of the total investment and can impact the overall value of the retirement portfolio.[3] If you plan to be buying and selling your assets frequently, these charges can add up. But a long-term retirement portfolio is usually best executed when you aren’t making frequent transactions. So, it’s important to carefully examine sales charges and make choices that best match your retirement goals.

You Get What You Pay For

Examining fees is an essential aspect of retirement planning, as it can significantly impact the overall value of retirement savings. However, a cheap retirement plan is sometimes cheap in quality too. The key is making sure you’re paying for the right things that seek to help achieve your retirement goals.

If you are looking for a guide to addressing your fee situation, contact one of our advisors today. We can help you to understand and navigate the many fees and complications in retirement planning.


[1, 3] https://www.forbes.com/sites/forbesfinancecouncil/2021/02/08/understanding-hidden-retirement-account-fees/?sh=73f8b2893233
[2] https://www.investopedia.com/articles/personal-finance/061913/hidden-fees-401ks.asp#:~:text=401(k)%20fees%20can%20range,the%20Center%20for%20American%20Progress.

This is for informational purposes only, does not constitute individual investment advice, and should not be relied upon as tax or legal advice. Please consult the appropriate professional regarding your individual circumstance.

Advisory Services offered through Asset Strategy Advisors, LLC (ASA), an SEC-Registered Investment Advisor.  Securities offered through Concorde Investment Services, LLC. (CIS), member FINRA/SIPC. Insurance Services offered through Asset Strategy Financial Group, Inc. (ASFG)”. ASA, CIS and ASFG are separate companies.

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