A fund takes a small slice of your money every year to run itself. On a fund it is called the TER, or “ongoing charges”.
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The slice comes out every year, and what it takes can’t grow for you any more. The fee compounds, like your returns, in the other direction.
€10,000 for 30 years at 7% a year becomes about €76,000. With a 1% fee it grows at 6%: about €57,000. The fee took €19,000.
“1%” sounds like almost nothing. Over 30 years it is a quarter of what you would have had.
Every EU fund publishes a key information document. Its yearly costs are on it, as a percentage.
A yearly fee compounds against you: 1% for 30 years takes about a quarter.
Do it today
Find your fund’s yearly fee (the TER).
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