In the world of investing, one of the most important factors to consider when building a resilient portfolio is minimizing fees. While it may seem like a small detail, the impact that fees can have on your overall returns over time is significant. By lowering fees, you can increase your investment returns and build a more financially stable future for yourself.
One way to lower fees in your portfolio is to focus on low cost index funds or exchange traded funds (ETFs) instead of actively managed funds. Actively managed funds typically come with higher fees to cover the costs of the fund manager's expertise and research. However, research has shown that the majority of actively managed funds underperform their benchmark indices over the long term. By investing in low cost index funds or ETFs, you can achieve similar or even better returns while paying lower fees.
Another way to lower fees in your portfolio is to be mindful of the fees associated with your brokerage account. Some brokerage accounts charge higher fees for trades or account maintenance, which can eat into your investment returns over time. Look for a brokerage account that offers low or no fees for trades and account maintenance to maximize your investment returns.
Additionally, consider the fees associated with any financial advisors or investment professionals that you work with. While it can be beneficial to seek professional guidance when building your portfolio, be sure to inquire about their fees and consider alternatives if their fees are too high. You may be able to find a fee only financial advisor who charges a flat fee or hourly rate, rather than a percentage of your assets under management.
By focusing on lowering fees in your portfolio, you can build a more resilient investment strategy that will withstand market volatility and economic downturns. Take the time to review your current investment holdings and assess the fees that you are paying. Make adjustments as needed to reduce fees and increase your overall investment returns. By prioritizing financial fortitude without compromise, you can secure a brighter financial future for yourself and your loved ones.