12b-1 Fee
What is a 12b-1 fee and why should you care?
What is a 12b-1 fee and why should you care?
A 12b-1 fee is a mutual fund fee assessed to pay for the marketing of the fund. It usually runs around .25%, but can reach as high as 1% per year. Should you own a mutual fund that charges YOU, the owner of the mutual fund, to advertise to others? Hell NO. Avoid mutual funds with this fee and other high fees as you strive to get your total cost (expense ratio, sometimes called the management fee) below .3% and ideally below .1%. Higher returns will follow!