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tony

The Fees You Don't See Can Hurt You

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Lots of insightful comments here. Following Dan's single vendor post, I made contact with the Wise Choice for Educators, nppfa.org. Debbyk followed up via email and this afternoon I spoke with her. I'm calling my business office tomorrow to start the single-vendor conversation. I remain hopeful.

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I found this info in a ICI Fact Book for 2015, with data mostly up through 2014. Although the explanations are often incomplete and have an industry bias, the data is interesting. The trends towards lower expense ratios, fewer load funds, and increasing use of index funds are certainly in the right direction. Of course there's still a very long way to go!

The graph (at the end of chapter 5) showing almost half of 401k equity MF assets had ERs of .50 to .99% caught my eye. Wouldn’t it be great if the total expense of all 403b equity mutual fund assets were as low as these (which are not all that low!)? Instead the annuity 403b total expenses probably run to between 2 to 3%! http://www.icifactbook.org/fb_ch5.html

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I found this info in a ICI Fact Book for 2015, with data mostly up through 2014. Although the explanations are often incomplete and have an industry bias, the data is interesting. The trends towards lower expense ratios, fewer load funds, and increasing use of index funds are certainly in the right direction. Of course there's still a very long way to go!

The graph (at the end of chapter 5) showing almost half of 401k equity MF assets had ERs of .50 to .99% caught my eye. Wouldn’t it be great if the total expense of all 403b equity mutual fund assets were as low as these (which are not all that low!)? Instead the annuity 403b total expenses probably run to between 2 to 3%! http://www.icifactbook.org/fb_ch5.html

Thanks for the link. What an awesome report. The data keeps coming in year after year, investors are paying more and more attention to two crucial investing issues: 1. costs and 2. indexing strategy.

 

I like to credit the decrease in active managed fund assets and lower prices to this one company (perhaps Fidelity too with its Spartan Funds) with over 3 Trillion and 20 million clients--Vanguard.

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