Tweet HOW RETIREMENT FEES

COST YOU Today in America, your main road

to retirement is a 401(k) But do you know

how much your plan

is costing you?

For 6 in 10

Americans

the answer is

No. Over the course of a lifetime,

an ordinary American can pay

as much as $109,407 in retirement fees

to their mutual fund providers Here's How 401(k) fees fall into three main groups. Administrative

Fees Asset

ManagementFees Marketing

Fees These costs are tallied up and

expressed as a number called It sounds simple,

but when it comes to the expense ratio,

things aren’t always as they seem... Let's do some math! Imagine you have $50,000 invested in a

Mutual Fund Which, in total, earns 5.88% (gross return) with an expense ratio of 1.23% Investors might assume their fees are

calculated by applying the expense ratio

to the amount that's been earned on their

investment (gross return). Assumption $50,000 5.88% 1.23% Applied to Applied to + 5.88% gross return - 1.23% expenses So, after one year... Your retirement money

would earn $2,940 And cost you only $36.16 In reality, the expense ratio is

applied to the full balance of your account So instead of paying

$36.16 in fees

you are actually paying $615 And there is one more charge that is

not factored into the expense ratio — trading fees.

This additional layer of costs can effectively double the amount you are paying in fees. Of course, that may not seem like

much compared against your new

balance... but over time,

those fees compound... 10 years on... and you've paid $20,603 in fees After 20 years your retirement savings stand at $124,095 but that has cost as much as $73,406 in fees