The graph above is for illustrative purposes and shows the difference a 0.25% fee vs 1.15% fee will have on a $10,000 portfolio invested over 20 years using a hypothetical performance of 8%pa.
The Cumulative Impact of Fees on Long Term Wealth
Whilst plenty has been said about asset allocation, risk tolerance and market cycles, one of the most reliable and easiest to control-drivers of long term performance is fees.
Fees can quietly erode not only a client's capital but also the compound growth that capital could have delivered.
Why does this matter?
We can see from the example above that even a small difference of 0.9 bp can translate into thousands of dollars over a 20 year time horizon.
The lesson is simple - while you can't control markets you can control costs. Choosing a low cost fund leaves more money invested in the market working over time.
