In a year where Wall Street should be getting coal rather than sweet meats they are poised to award themselves 10% more in 2007 regardless of the mortgage mess they invested in. 
United States of America (Press Release) December 15, 2007 --
IMMEDIATE RELEASE James Burns
(949) 440-3243
(ALISO VIEJO, CA)—James Burns, Esq. a tax attorney whose new book “The 3 Secret Pillars of Wealth” is timely in describing the costs involved when investing in mutual funds as we await the bonus announcement for Wall Street elite, no matter how much jeopardy they placed our economy in with the risky subprime mortgage investing.
In a year where Wall Street should be getting coal rather than sweet meats they are poised to award themselves 10% more in 2007 regardless of the mortgage mess they invested in. Most U.S. businesses – 66 percent – give no bonuses at all. Those employees lucky enough to receive a cash gift will get an average of $837.
When you invest in the typical mutual fund (assuming outside of a qualified retirement plan), you face costs that erode your benefit. Chances are you’re not aware of them, they’re not in your prospectus and your broker isn’t going to sit down and tell you about them. The five costs of mutual fund investing are:
1. Tax costs – excessive capital gains from active trading.
2. Transaction costs – the cost of the trades themselves.
3. Opportunity costs – dollars taken out of portfolios for a fund’s safekeeping.
4. Sales charges – both seen and hidden.
5. Expense ratio, or “management fees” – no end to increases in site. This is a calculation based on the operating costs of the fund divided by the average amount of assets under management.
Burns shows what the average fund investor is losing a third of their return just for the cost of maintaining their investment. Add in the 1.5% capital gains tax bill that the average fund investor pays each year and that figure shoots up to 46% of your return being lost to fees and expenses, nearly half of a potential 10% return.
If you feel these numbers are hard to believe says Burns, "you should run your own numbers based on any mutual funds you have outside of an index fund and see if you’re getting terrific gains since the Christmas bonuses have to come from somewhere. “
(949) 440-3243
(ALISO VIEJO, CA)—James Burns, Esq. a tax attorney whose new book “The 3 Secret Pillars of Wealth” is timely in describing the costs involved when investing in mutual funds as we await the bonus announcement for Wall Street elite, no matter how much jeopardy they placed our economy in with the risky subprime mortgage investing.
In a year where Wall Street should be getting coal rather than sweet meats they are poised to award themselves 10% more in 2007 regardless of the mortgage mess they invested in. Most U.S. businesses – 66 percent – give no bonuses at all. Those employees lucky enough to receive a cash gift will get an average of $837.
When you invest in the typical mutual fund (assuming outside of a qualified retirement plan), you face costs that erode your benefit. Chances are you’re not aware of them, they’re not in your prospectus and your broker isn’t going to sit down and tell you about them. The five costs of mutual fund investing are:
1. Tax costs – excessive capital gains from active trading.
2. Transaction costs – the cost of the trades themselves.
3. Opportunity costs – dollars taken out of portfolios for a fund’s safekeeping.
4. Sales charges – both seen and hidden.
5. Expense ratio, or “management fees” – no end to increases in site. This is a calculation based on the operating costs of the fund divided by the average amount of assets under management.
Burns shows what the average fund investor is losing a third of their return just for the cost of maintaining their investment. Add in the 1.5% capital gains tax bill that the average fund investor pays each year and that figure shoots up to 46% of your return being lost to fees and expenses, nearly half of a potential 10% return.
If you feel these numbers are hard to believe says Burns, "you should run your own numbers based on any mutual funds you have outside of an index fund and see if you’re getting terrific gains since the Christmas bonuses have to come from somewhere. “
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