You’ve done everything right: Saved, invested, stayed the course. But what if the fees you didn’t notice have been holding you back? Even small costs can add up over time, reducing the money you have working toward your goals. The good news: Spotting and reducing excessive fees doesn’t have to be complicated—and it can make a real difference for your future.

The fees you don’t see can cost more than you think

Even slight differences in fees can add up over time. For example, on a $100,000 portfolio earning 4% annually, the difference between a 0.25% and a 1.00% ongoing fee could cost you nearly $30,000 over 20 years. That’s money that could have stayed invested and working toward your goals.

Fees and where to find them

Fees can take you by surprise if you’re not looking for them. These are some common costs and where you can find the ones you may be paying.

Mutual fund fees

• Expense ratios: This annual fee is built into the fund’s price and covers management and operating costs. Actively managed funds tend to charge more than index funds.
• Sales charges and short-term fees: Some funds have front-end loads, redemption fees, or short-term trading fees.
• 12b-1 fees: These marketing and distribution fees are often included in the expense ratio and can be avoided by choosing no-load share classes.

Where to find them: In the fund’s prospectus or summary prospectus, look for Fees and Expenses and Annual Fund Operating Expenses tables.

To find out more, read Fidelity Learn: Mutual fund fees and expenses

ETF fees

ETFs also charge expense ratios. Because they trade on exchanges, they come with trading costs as well.

• Bid-ask spread: This is the difference between what buyers pay and sellers receive. It’s generally small for large, liquid ETFs but can widen in volatile markets or for niche funds.

  Let’s say you’re buying shares of an ETF:

  • Bid price (what buyers are willing to pay): $100.00
  • Ask price (the price sellers are asking for): $100.10
  • Spread: $0.10

  If you buy at the ask price and immediately sell at the bid price, you lose $0.10 per share—even if the market hasn’t moved. That’s the cost of the spread, and it can hit your wallet directly.

• Premiums/discounts to NAV: ETF shares can trade slightly above or below their net asset value (NAV).
• Brokerage commissions: Like Fidelity, many brokers offer commission-free ETF trades, but not all do.

Where to find them: In the ETF’s prospectus, look for the expense ratio. Check the ETF’s website for premium/discount and spread data, or you can find it on the ETF research page on Fidelity.com. When placing a trade, review trade previews and confirmations. You should see transaction fees before you place an order and then confirmations show what you paid.

For more ETF tips, read Fidelity Viewpoints: How to shop smart for ETFs

Advisory and account fees

• Advisory fees: Managed accounts typically charge 0.25%–1.00% annually for professional portfolio management.¹
• Account maintenance/platform fees: Some accounts charge periodic fees for access or services. Fidelity has no maintenance fees or account service charges.

Where to find them: For managed accounts, your account statement typically lists any advisory fees and when they’re debited.

When evaluating new services, make sure you understand how your financial professional is compensated. Fee structures can vary: Some professionals charge a flat or hourly fee for advice, while others use an annual advisory fee—often based on a percentage of assets managed. Transparency and trust are critical, so ask for a clear explanation of costs before you commit.

How to analyze and compare fees

• Screeners and research tools:

  Most brokerage platforms offer fund screeners that let you filter by key cost metrics—such as expense ratio, transaction fees, and portfolio turnover, like Fidelity’s mutual fund evaluator.

• Independent calculators:

  Tools like ² allow you to model how fees compound over time. You can compare different share classes (e.g., A vs. C shares), estimate the impact of advisory or wrap fees, and visualize how a lower-cost option might grow faster over decades. This is especially useful when evaluating managed accounts or deciding between active and passive strategies.

What’s normal when it comes to fees?

Understanding typical fee ranges can help you spot outliers and make informed choices.

For instance, many fees are described as an “asset-weighted average.” That tells you what most investors are actually paying—not just a simple average of all funds.

Read Fidelity Viewpoints: How to pick a mutual fund

Typical fund fee ranges

^{Source: Investment Company Institute, “Trends in the Expenses and Fees of Funds, 2024.”}

What is an “asset-weighted average” and why does it matter?

An asset-weighted average means each fund’s fee is weighted by the amount of money invested in it. Larger funds count more in the calculation, so the number reflects where most investor dollars are.

Example:

• Fund A: 0.50% expense ratio, $10 billion in assets
• Fund B: 1.00% expense ratio, $1 billion in assets

A simple average would be (0.50% + 1.00%) ÷ 2 = 0.75%. But an asset-weighted average would be closer to 0.55%, because most assets are in the lower-cost fund.

For individual investors, it can help you understand what other people typically pay and it can help you understand if your fund is in line with the market.

Focusing on fees has paid off for investors

Investing has become far more cost-friendly over time. The average asset-weighted expense ratio for all mutual funds and exchange-traded funds dropped to 0.34% in 2024, less than half the cost from 20 years ago.¹ From 1996 to 2024, fees on stock mutual funds fell 62%, and bond fund fees fell 55%, driven by industry competition and a growing shift toward lower-cost options.³

When paying a fee can be worth it

Not all fees are bad. If a managed account helps you keep your investment mix in line with your financial goals, improves tax efficiency, or frees up your time, the fee may be worth it. Likewise, mutual funds and ETFs offer professional management, diversification, and convenience that can be hard to replicate on your own. The right fee is one that helps you reach your goals—without taking more than it gives.