The long term health of your portfolio depends on staying consistently invested and keeping fees low.  The most common investment management fee is 1.0% of the value of the account annually, but we have seen some portfolios charged an additional 1.0% or more in the underlying fund fees.

It's not always easy to identify the individual fund fees.  If you have the ticker symbol for the fund, search the ticker symbol on the internet and the fee is labeled Expense Ratio.  This fee is paid in addition to a management fee and can cause a big drag on performance.

This chart illustrates the cumulative impact over time of different expense levels.

The More They Take ... The Less You Make

We are using a $1 million portfolio as an example, but the magnitude of the impact is the same regardless of portfolio size. If the portfolio was earning 6 percent on average annually, a 2 percent management fee is keeping a third of the returns.

Great for the investment firm, but not so great for the investor.