Over the long-term, fees have a significant effect on the growth of a portfolio. Paying an extra 1% or 1.5% in fees per year can leave an investor with a meaningfully lower amount at retirement.
To illustrate this, lets compare two investment funds over a 25-year time-period that are both generating a 6%* annual rate of return (before fees), have a monthly contribution of $500 and start with a balance of $50,000.
Graph prepared by LINK Plan Management. Starting value of $50,000 with monthly contributions equal to $500 growing a net annual rate of 6.0% and 4.5% (after fees). Graph lines are smoothed and do not represent actual anticipated portfolio volatility.
LINK portfolios carry an average MER of 0.15%, which, when combined with our low Plan Service Fee, helps keep our client’s fees significantly lower than those of traditional plans. We want to ensure that our clients keep the majority of their investment gains!
* Rate of return is meant for illustration purposes only and should not be construed as potential minimum or maximum returns for any of LINK’s portfolios.
Notes on risk: All investing is subject to risk. Past performance is no guarantee of future results. Diversification does not ensure a profit or protect against losses in a declining market. There is no guarantee that any given asset allocation or mix of securities will meet your investment objectives or provide you with a given level of income.
