What Fees To Know and Consider When Investing?

As a beginner starting out with investing, be it in stocks or bonds or funds through brokerages, robo-advisors and even crypto exchanges, you are bombarded with so many different types of fees: trading fees, platform fees, management fees, commission fees, performance fees, fx fees, securities fees, etc.

It can be daunting and overwhelming to know what everything means and how they are going to affect their investments.

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Comment down below what different types of fees there are when investing, what they mean, how they affect your investment money, and other things to take into consideration when evaluating fees.

Hope this post can help someone out who is new to investing to clear their confusion and navigate their investing journey more easily!

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CTKS

12 Nov 2021

Commission fees - custodian brokers offer cheaper fees ($2-4) while non-custodian brokers are more costly ($10-25)

management/monthly/custodian fees - ideally $0

I think these two are the most important fees to take note. Additionally, check if there are any recurring fees, those are killer...

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thefrugalstudent

24 Oct 2021

Founder at thefrugalstudent.com

Fees are simply the cost of investing. So whenever you can, minimising it will help to maximise returns. Fees aren't always bad though, because sometimes paying for them can earn things that you value more. For example, paying fees for added convenience to free up time in your life for other things.

Commission fee: paid to the broker you use for processing the trade

Platform fee: paid to the broker you use for using their platform

Expense ratio: paid to the management of the ETF you invest in

Management fee: paid to the management of the unit trust/robo advisor for their expertise in managing your funds/portfolios

FX fee: paid to the broker you use for performing the FX conversion for you

Custodian fee: paid to the broker you use for holding your shares in their custodian account

Clearing fee: paid to the exchange

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